Answered step by step
Verified Expert Solution
Question
1 Approved Answer
Aug. 1 Purchased merchandise from Sherif Company for $7,500 under credit terms of 1/10, 1/30, FOB destination, invoice dated August 1. 5 Sold merchandise to
Aug. 1 Purchased merchandise from Sherif Company for $7,500 under credit terms of 1/10, 1/30, FOB destination, invoice dated August 1. 5 Sold merchandise to Farid Corp. for $5,200 under credit terms of 2/10, 1/60, FOB destination, invoice dated August 5. The merchandise had cost $4,000. 8 Purchased merchandise from Shady Corporation for $5,400 under credit terms of 1/10, 1/45, FOB shipping point, invoice dated August 8. The invoice showed that at Shahab's request, Shady paid the $140 shipping charges and added that amount to the bill. (Hint: Discounts are not applied to freight and shipping charges.) 9 Paid $125 cash for shipping charges related to the August 5 sale to Farid Corp. 10 Farid retumed merchandise from the August 5 sale that had cost Shehab $400 and been sold for $600. The merchandise was restored to inventory. 12 After negotiations with Shady Corporation concerning problems with the merchandise purchased on August 8, Shehab recelved a credit memorandum from Shady granting a price reduction of $700. 14 At Sherif's request, Shehab paid $200 cash for freight charges on the August 1 purchase, reducing the amount owed to Sherif 15 Received balance due from Farid Corp. for the August 5 sale less the return on August 10. 18 Paid the amount due Shady Corporation for the August 8 purchase less the price reduction granted. 19 Sold merchandise to Romany Co. for $4,800 under credit terms of 1/10, 1/30, FOB shipping point, invoice dated August 19. The merchandise had cost $2,400. 22 Romany requested a price reduction on the August 19 sale because the merchandise did not meet specifications. Shehab sent Romany a $500 credit memorandum to resolve the issue. 29 Received Romany's cash payment for the amount due from the August 19 sale. 30 Paid Sherif Company the amount due from the August 1 purchase. Prepare journal entries to record the above merchandising transactions of Shehab Company, which applies the perpetual inventory system
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started