General Journal for

Aug. 1 Purchased merchandise from Aron Company for $7,500 under credit terms of 1/10, n/30, FOB destination, invoice dated August 1. Aug. 5 Sold merchandise to Baird Corp. for $5,200 under credit terms of 2/10, n/60, FOB destination, invoice dated August 5. The merchandise had cost $4,000. Aug. 8 Purchased merchandise from Waters Corporation for $5,400 under credit terms of 1/10, n/45, FOB shipping point, invoice dated August 8. Aug. 9 Paid $125 cash for shipping charges related to the August 5 sale to Baird Corp. Aug. 10 Baird returned merchandise from the August 5 sale that had cost Lowes $400 and was sold for $600. The merchandise was restored to inventory. Aug. 12 After negotiations with Waters Corporation concerning problems with the purchases on August 8, Lowes received a credit memorandum from Waters granting a price reduction of $400 off the $5,400 of goods purchased. Aug. 14 At Arons request, Lowes paid $200 cash for freight charges on the August 1 purchase, reducing the amount owed to Aron. Aug. 15 Received balance due from Baird Corp. for the August 5 sale less the return on August 10. Aug. 18 Paid the amount due Waters Corporation for the August 8 purchase less the price allowance from August 12. Aug. 19 Sold merchandise to Tux Co. for $4,800 under credit terms of n/10, FOB shipping point, invoice dated August 19. The merchandise had cost $2,400. Aug. 22 Tux requested a price reduction on the August 19 sale because the merchandise did not meet specifications. Lowes sent Tux a $500 credit memorandum toward the $4,800 invoice to resolve the issue. Aug. 29 Received Tuxs cash payment for the amount due from the August 19 sale less the price allowance from August 22. Aug. 30 Paid Aron Company the amount due from the August 1 purchase.

For each transaction, indicate the impact each item had on income and the dollar amount of the change in income, if any. Input decreases to net income as negative values. Upon completion, compare the amount of income with the amount reported on the partial income statement.

000: Increases net income

000: Decreases net income

000: No impact on income

	Impact on income	Increase (decrease) to income
Aug. 1) Purchased merchandise from Aron Company for $7,500 under credit terms of 1/10, n/30, FOB destination, invoice dated August 1.
Aug. 5) Sold merchandise to Baird Corp. for $5,200 under credit terms of 2/10, n/60, FOB destination, invoice dated August 5.
Aug. 5) The merchandise sold to Baird had cost $4,000.
Aug. 8) Purchased merchandise from Waters Corporation for $5,400 under credit terms of 1/10, n/45, FOB shipping point, invoice dated August 8.
Aug. 9) Paid $125 cash for shipping charges related to the August 5 sale to Baird Corp.
Aug. 10) Baird returned merchandise from the August 5 sale that had sold for $600.
Aug. 10) The cost of the merchandise returned by Lowes was $400. The merchandise was restored to inventory.
Aug. 12) After negotiations with Waters Corporation concerning problems with the purchases on August 8, Lowes received a credit memorandum from Waters granting a price reduction of $400 off the $5,400 of goods purchased.
Aug. 14) At Arons request, Lowes paid $200 cash for freight charges on the August 1 purchase, reducing the amount owed to Aron.
Aug. 15) Received balance due from Baird Corp. for the August 5 sale less the return on August 10.
Aug. 18) Paid the amount due Waters Corporation for the August 8 purchase less the price allowance from August 12.
Aug. 19) Sold merchandise to Tux Co. for $4,800 under credit terms of n/10, FOB shipping point, invoice dated August 19.
Aug. 19) The cost of the merchandise sold merchandise to Tux was $2,400.
Aug. 22) Tux requested a price reduction on the August 19 sale because the merchandise did not meet specifications. Lowes sent Tux a $500 credit memorandum toward the $4,800 invoice to resolve the issue.
Aug. 29) Received Tuxs cash payment for the amount due from the August 19 sale less the price allowance from August 22.
Aug. 30) Paid Aron Company the amount due from the August 1 purchase.
Total income