Exercise 5-8 (Algo) Recording purchases, purchases returns, and purchases allowances LO P1

Prepare the appropriate journal entries for Macy Company to record each of the May transactions. Macy Is a retaller that uses the gross method and a perpetual inventory system; it purchases these units for resale.

Note: If no entry Is required for a transaction/event, select "No Journal entry required" In the first account fleld.

Required Information Use the following information for the Exercises below. [The following information applies to the questions displayed below.] Allied Merchandisers was organized on May 1. Macy Company is a major customer (buyen) of Allied (sellen) products. 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 59 cash per unit (for a total cost of $18,00 ). May 5 Allied sold 1,000 of the units in inventory for $13 per unit (invoice tota1: $13, 000 ) to Macy Company under credit teras 2/10,n/60. The goods cost Allied $9,000. May 7 Macy returns 100 units because they did not fit the customer's needs (invoice anount: $1,300 ). Alifed restores the units, which cost $900, to its inventory. May 8 Macy discovers that 100 units are scuffed but are still of use and, therefore, keeps the unfts. Allied gives a price reduction (allowance) and credits Macy's accounts receivable for $500 to compensate for the damage. May 15 Allied recelves payment fron Hacy for the amount oased on the May 5 purchase; payment is net of returns, allowances, and any cesh discount. Exercise 5-8 (Algo) Recording purchases, purchases returns, and purchases allowances LO P1 Prepare the appropriate journal entries for Macy Company to record each of the May transactions. Macy is a retaller that uses the gross method and a perpetual inventory system; it purchases these units for resale. Note: If no entry is required for a tronsoction/event, select "No journal entry required" In the first account fleld. Exercise 5-8 (Algo) Recording purchases, purchases returns, and purchases allowances LO P1 Prepare the appropriate joumal entries for Macy Company to record each of the May transactions. Macy is a retaller that uses the gross method and a perpetual inventory system; it purchases these units for resale. Note: If no entry is required for a transaction/event, select "No journal entry required" in the first account fleld