Based on the data presented in Exercise 5-21, journalize Balboa Co.’s entries for 

(a) The purchase, 

(b) The return of the merchandise for credit, and 

(c) The payment of the invoice.

Exercise 5-21

Showcase Co., a furniture wholesaler, sells merchandise to Balboa Co. on account, $254,500, terms n/30. The cost of the goods sold is $152,700. Showcase Co. issues a credit memo for $30,000 for merchandise returned prior to Balboa Co. paying the original invoice. The cost of the merchandise returned is $17,500. Journalize Showcase Co.’s entries for 

(a) The sale, including the cost of the goods sold, 

(b) The credit memo, including the cost of the returned merchandise, and

(c) The receipt of the check for the amount due from Balboa Co.