1 nces Prepare journal entries to record the following merchandising transactions of Lowe's, which uses the perpetual inventory system and the gross method Hint. It will help to identify each receivable and payablo, for example, record the purchase on August 1 in Accounts Payable Aron Aug 1 Purchased merchandise fron Aron Company for $7,500 under credit teras of 1/10, 1/30, FOB destination, invoice dated August 1. S Sold merchandise to Baird Corp. for $5,200 under credit terns 10, 1/60, FOB destination, invoice dated August 5. The merchandise had cost $4,000 3 Purchased merchandise fron Waters Corporation for $5,406 under credit terms of 1/10, 1/45, Foe shipping point, invoice dated August 8. 9 Paid $125 cash for shipping charges related to the August 5 sale to Baird Corp. 10 Baird returned merchandise from the August 5 sale that had cost Lowe's $100 and was sold for 360. The merchandise was restored to inventory 12 After negotiations with Waters Corporation concerning problems with the purchases on August 8, Lowe's received a price reduction to waters of $400 off the 55,400 of goods purchased. Lowe's debited accounts payable for $400. 14 At Aron's request, Lowe's paid $200 cash for freight charges on the August 1 purchase, reducing the amount owed (accounts payable) to Aron 15 eived balance de fron Baird Corp. for the August 5 sale less the return on August 10. 18 Paid the amount due Waters Corporation foe the August & purchase less the price allowance from August 12. 19 Sold merchandise to Tux Co. for $4,500 under credit terms of n/10, FOB shipping point, invoice dated August 19. The merchandise had cost $2,400 22 Tux requested a price reduction on the August 19 sale because the merchandise did not meet specifications Lowe's gave a price reduction (allowance) of $500 to Tux, and credited Tux accounts receivable for that amount. 29 Received cash payent for the mount due from the August 19 sale loss the price allowance from August 22. 30 Paid Aron Company the amount due from the August 1 purchase