Allied Merchandisers was organized on May 1. Macy Co. is a major customer (buyer) of Allied (seller) products. Perpetual

May 3 Allied made its first and only purchase of inventory for the period on

May 3 for 2,000 units at a price of $11 cash per unit (for a total cost of $22,000).

May 5 Allied sold 1,000 of the units in inventory for $15 per unit (invoice total: $15,000) to Macy Co. under credit terms 2/10, n/60. The goods cost Allied $11,000. 7 Macy returns 100 units because they did not fit the customers needs (invoice amount: $1,500). Allied restores the units, which cost $1,100, to its inventory.

May 8 Macy discovers that 100 units are scuffed but are still of use and, therefore, keeps the units. Allied gives a price reduction (allowance) and credits Macy's accounts receivable for $700 to compensate for the damage.

May15 Allied receives payment from Macy for the amount owed on the May 5 purchase; payment is net of returns, allowances, and any cash discount.

Please do the Journal worksheet to include these answers (Perpetual method)

1. Allied made its first and only purchase of inventory for the period on May 3 for 2,000 units at a price of $11 cash per unit (for a total cost of $22,000).

2. Allied sold 1,000 of the units in inventory for $15 per unit (invoice total: $15,000) to Macy Co. under credit terms 2/10, n/60. The goods cost $11,000 to Allied.

3. Macy returns 100 units because they did not fit the customers needs (invoice amount: $1,500). Allied restores the units, which cost $1,100, to its inventory.

4. Macy discovers that 100 units are scuffed but are still of use and, therefore, keeps the units. Allied gives a price reduction (allowance) and credits Macy's accounts receivable for $700 to compensate for the damage.

5. Allied receives payment from Macy for the amount owed on the May 5 purchase; payment is net of returns, allowances, and any cash discount.