Chapter 5

Assignment 5-1

Below you will find descriptions of nine (9) transactions.

On the excel attachment, complete the journal entries by typing in your answers in the boxes provided for the following merchandising transactions for both the PERPETUAL and PERIODIC inventory systems.

You are asked to forward you completed excel assignment answer back to me using C4. If that is not possible, print out the excel page and complete the answer by hand, and then either scan it back using C4, or take a picture of it and scan it back using C4.

a) Nov 1 Purchased merchandise from Costmore Ltd. for $3,000 on credit with terms of 1/10, n/30, FOB shipping point.

b) Nov 3 Paid $200 for shipping charges for the purchase of Nov 1.

c) Nov 10 Paid Costmore Ltd. for the merchandise purchased on Nov 1.

d) Nov 11 Returned 10% of the merchandise to Costmore Ltd. from the Nov 1 purchase.

e) Nov 13 Sold merchandise to Cedar Inc. for $2,000 on account (cost of the merchandise was $750) terms 2/15, n/60 FOB destination.

f) Nov 14 Paid the $50 transportation charges to deliver the merchandise sold to Cedar Inc.

g) Nov 16 Cedar Inc. returned an item from the November 13^th sale. The item had sold for $200 and cost $75.The item will be returned to inventory.

h) Nov 20 Cedar Inc. received a price reduction of $100 regarding the November 13 sale.

I) Nov 27 Cedar Inc. paid the balance due from sale on November 13.