Question

March 4 Stephen Company sold $3,000 of merchandise on account to Elijah Company. The credit terms were 2/10, n/60. The cost of the merchandise was $1,800. March 6 Elijah Company paid transportation cost of $100 on the March 4 purchase from Stephen Company. March 8 Stephen Company sold $2,000 of merchandise on account to Elijah Company. The credit terms were n/40. The cost of the merchandise was $1,400. March 10 Stephen Company paid transportation cost of $100 for delivery of merchandise sold to Elijah Company on March 8. March 16 Stephen Company issued Elijah Company a $400 credit memorandum for merchandise returned because the merchandise was damaged. The merchandise was purchased by Elijah Company on account on March 8. The cost of the merchandise returned was $280. March 18 Stephen Company received payment from Elijah Company for purchase of March 8. March 21 Stephen Company sold $4,800 of merchandise on account to Elijah Company. The credit terms were 2/10, n/30. The cost of the merchandise was $2,880. March 22 Stephen Company received payment from Elijah Company for purchase of 4 March. March 31 Stephen Company received payment from Elijah Company for purchase of 21 March

Answer 1

Date	Particulars	Debit	Credit
04-Mar	Elijah Co. A/c Dr.	$3,000
	To, Sales		$3,000
04-Mar	COGS	$1,800
	To, Inventory		$1,800
06-Mar	No entry required in the books of Stephen Company assuming transport cost of $100 paid to outside vendor by Elijah.
08-Mar	Elijah Co. A/c Dr.	$2,000
	To, Sales		$2,000
	COGS	$1,400
	To, Inventory		$1,400
10-Mar	Transportation Cost A/c Dr.(selling expense)	$100
	To, Bank		$100
16-Mar	Sales return A/c Dr.	$400
	To, Elijah Co. A/c		$400
16-Mar	Inventory A/c Dr.	$280
	To, COGS		$280
18-Mar	Bank A/c Dr.	$2,000
	To, Elijah Co. A/c		$2,000
21-Mar	Elijah Co. A/c Dr.	$4,800
	To, Sales		$4,800
21-Mar	COGS	$2,880
	To, Inventory		$2,880
22-Mar	Bank A/c Dr.	$3,000
	To, Elijah Co. A/c		$3,000
31-Mar	Bank A/c Dr.	$4,704
	Discount A/c Dr.	$96
	To, Elijah Co. A/c		$4,800

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