EA$16.$ LO $6\mathrm{.}7$ Record journal entries for the following purchase transactions of Flower Company, using the periodic inventory method.

A$.$ On October $13,$ Flower Company purchased $85$ bushels of flowers with cash for $$1,300.$

B$.$ On October $20,$ Flower Company purchased $240$ bushels of flowers for $$20$ per bushel on credit. Terms of the purchase were $\frac{5}{10},\frac{n}{30},$ invoice dated October $20.$

C$.$ On October $30,$ Flower Company paid its account in full for the October $20$ purchase.

Solution

A$.$

Oct. $13$ Purchases

Cash

To recognize inventory purchase with cash

B$.$

Oct. $20$ Purchases

Accounts Payable

To recognize inventory purchase, $\frac{5}{10},\frac{n}{30}$

C$.$

$\backslash$table$[[$Oct$.30,$ Accounts Payable,,$],[,$Purchase Discounts,$],[,$Cash,$],[,$To recognize payment, less discount,$]]$