Question

Prepare Journal entries to record each of the following sales transactions of a merchandising company. The company uses a perpetual Inventory system and the gross method. Apr. 1 sold merchandise for $7,000, with credit termen/30; invoice dated April 1. The cost of the merchandise is $4,200. Apr. 4 The customer in the April 1 sale returned $780 of merchandise for full credit. The merchandise, which had cont $468, is returned to inventory. Apr. 8 Sold merchandise for $3,000, with credit terms of 1/10, n/30; invoice dated April 8. Cost of the merchandise is $2,100. Apr. 11 Received payment for the amount due from the April 1 sale loss the return on April 4.

Answer 1

Journal Entries Date Account Title and Explaination Post. Ref. Debit (S) Credit (S) Apr.1 $ 7,000.00 Accounts Receivable Sales Revenue (To record Sales on Account) $ 7,000.00 $ 4,200.00 Cost of Goods Sold Merchandise Inventory (To record Cost of Goods Sold) $ 4,200.00 Apr.4 $ 780.00 Sales Returns and Allowance Accounts Receivable (To record Sales Returns) $ 780.00 468.00 Merchandise Inventory Cost of Goods Sold (To record Cost of goods returned) 468.00

Apr.8 S 3,000.00 Accounts Receivable Sales Revenue (To record Sales on Account) $ 3,000.00 $ 2,100.00 Cost of Goods Sold Merchandise Inventory (To record Cost of Goods Sold) $ 2,100.00 $ 6,220.00 Apr.11 Cash Accounts Receivable ($7000-$780) (To record Collection of receivables) 6,220.00