Question

GL04-01 - Based on Problem 4-1A LO P1, P2 Prepare journal entries to record the following merchandising transactions of Taylor's, which uses the perpetual inventory system and the gross method. (Hint: It will help to identify each receivable and payable; for example, record the purchase on July 1 in Accounts Payable-Walker.) Jul. 1 Purchased merchandise from Walker Company for $8,600 under credit terms of 1/15, n/30, FOB shipping point, invoice dated uly 1 Jul. 2 Sold merchandise to Perry Co. for $2,200 under credit terms of 2/10, n/60, FOB shipping point, invoice dated July 2. The merchandise had cost $1,320. Jul. 3 Paid $645 cash for freight charges on the purchase of July 1. Jul. 8 Sold merchandise that had cost $2,600 for $4, 300 cash Jul. 9 Purchased merchandise from Ryan Co. for $3,500 under credit terms of 2/15, n/60, FOB destination, invoice dated July 9 Jul. 11 Received a $700 credit memorandum from Ryan Co. for the return of part of the merchandise purchased on July9 Jul. 12 Received the balance due from Perry Co. for the invoice dated July 2, net of the discount. Jul. 16 Paid the balance due to Walker Company within the discount period Jul, 19 Sold merchandise that cost $2,700 to Clinton Co. for $3,800 under credit terms of 2/15, n/60, FOB shipping point, invoice dated July 19. Jul. 21 Issued a $800 credit memorandum to Clinton Co. for an allowance on goods sold on July 19. Jul. 24 Paid Ryan Co. the balance due, net of discount Jul. 30 Received the balance due from Clinton Co. for the invoice dated July 19, net of discount Jul. 31 Sold merchandise that cost $5,800 to Perry Co. for $9,600 under credit terms of 2/10, n/60, FOB shipping point, invoice dated July 31.

Answer 1

You can adjust account headings as per your options

Date	Particular	Debit	Credit
Jul,1	Merchandise Purchase	$8,600
	Account Payable-Walker		$8,600
Jul, 2	Account Receivable- Perry Co.	$2,200
	Sales		$2,200
Jul, 2	Cost of Goods Sold	$1,300
	Finished Goods		1300
Jul, 3	Freight Charges	645
	Cash		645
Jul, 8	Cash	4300
	Sales		4300
Jul, 8	Cost of Goods Sold	$2,600
	Finished Goods		2600
Jul,9	Merchandise Purchase	3500
	Account Payable-Ryan		3500
Jul, 11	Account Payable-Ryan	700
	Purchase Return		700
Jul,12	Cash	2156
	Cash Discount Allowed	44
	Account Receivable- Perry Co.		2200
	[2200*98%]
Jul, 16	Account Payable-Walker	8600
	Cash [8600*99%]		8514
	Cash Discount Received		86
Jul,19	Account Receivable- Clinton Co.	3800
	Sales		3800
Jul,19	Cost of Goods Sold	$2,700
	Finished Goods		2700
Jul, 21	Allowance Expense	800
	Account Receivable- Clinton Co.		800
Jul, 24	Account Payable-Ryan [3500-700]	2800
	Cash [2800*98%]		2744
	Cash Discount Received		56
Jul, 30	Cash [3000*98%]	2940
	Cash Discount Allowed	60
	Account Receivable- Clinton Co.		3000
	[3800-800]
Jul, 31	Account Receivable- Perry Co.	9600
	Sales		9600
Jul, 31	Cost of Goods Sold	5800
	Finished Goods		5800