GLO401 - Based on Problem 4-1A LO P1, P2 Prepare journal entries to record the following merchandising transactions of Taylor's, which uses the perpetual inventory system and the gross method. (Hint: It will help to identify each receivable and payable; for example, record the purchase on July 1 in Accounts Payable-Walker.) Jul. 1 Purchased merchandise from Walker Company for $8,600 under credit terms of 1/15, n/30, FOB shipping point, invoice dated July 1. Jul. 2 Sold merchandise to Perry Co. for $2,200 under credit terms of 2/10, n/60, FOB shipping point, invoice dated July 2. The merchandise had cost $1,320. Jul. 3 Paid $645 cash for freight charges on the purchase of July 1. Jul 8 Sold merchandise that had cost $2,600 for $4,300 cash. Jul. 9 Purchased merchandise from Ryan Co. for $3,500 under credit terms of 2/15, n/60, FOB destination, invoice dated July 9. Jul. 11 Returned $700 of merchandise purchased on July 9 from Ryan Co. and debited its account payable for that amount. Jul. 12 Received the balance due from Perry Co. for the invoice dated July 2, net of the discount. Jul. 16 Paid the balance due to Walker Company within the discount period. Jul. 19 Sold merchandise that cost $2,700 to Clinton Co. for $3,800 under credit terms of 2/15, n/60, FOB shipping point, invoice dated July 19. Jul. 21 Gave a price reduction (allowance) of $800 to Clinton Co. for merchandise sold on July 19 and credited Clinton's accounts receivable for that amount. Jul. 24 Paid Ryan Co. the balance due, net of discount. Jul. 30 Received the balance due from Clinton Co. for the invoice dated July 19, net of discount. Jul. 31 Sold merchandise that cost $5,800 to Perry Co. for $9,600 under credit terms of 2/10, n/60, FOB shipping point, invoice dated July 31. Requirement General Journal General Ledger Trial Balance Schedule of Receivables Schedule of Payables Income Statement Impact on Income No Date Account Title Debit Credit 1 Jul 01 8,600 Merchandise inventory Accounts payable - Walker 8.600 2 Jul 02 2 200 Accounts receivable - Perry Sales 2.200 3 Jul 02 1.320 Cost of goods sold Merchandise inventory 1.320 4 Jul 03 845 Merchandise inventory Cash 845 5 Jul 08 4.300 Cash Sales 4.300 8 Jul 08 2.600 Cost of goods sold Merchandise inventory 2.600 7 Jul 09 3.500 Merchandise inventory Accounts payable - Ryan 3.500 8 Jul 11 700 Accounts payable - Ryan Merchandise inventory 700 9 Jul 12 Cash Sales discounts Accounts receivable - Perry 2.158 44 2.200 10 Jul 18 8.600 Accounts payable - Walker Merchandise inventory Cash 88 8,514 11 Jul 19 3.800 Accounts receivable - Clinton Sales 3.800 12 Jul 19 2.700 Cost of goods sold Merchandise inventory 2.700 13 Jul 21 800 Sales returns and allowances Accounts receivable - Clinton 800 14 Jul 24 2.800 Accounts payable - Ryan Merchandise inventory Cash 58 2.744 15 Jul 30 Cash Sales discounts Accounts receivable - Clinton 2.940 60 3.000 16 Jul 31 9.800 Accounts receivable - Perry Sales 9.600 17 Jul 31 5.800 Cost of goods sold Merchandise inventory 5.800 Requirement General Journal General Ledger Trial Balance Schedule of Receivables Schedule of Payables Income Statement Impact on Income Prepare a multiple-step income statement through the calculation of gross profit. Taylor's Company Partial Income Statement For the Month Ended July 31, 2019 $ 0 $ 0 0 0 0 0 0 $ Impact on income Increase (decrease) to income July 1) Purchased merchandise from Walker Company for $8,600 under credit terms of 1/15, n/30, FOB shipping point, invoice dated July 1. July 2) Sold merchandise to Perry Co. for $2,200 under credit terms of 2/10, n/60, FOB shipping point, invoice dated July 2. July 2) The cost of the merchandise sold to Perry Co. was $1,320 July 3) Paid $645 cash for freight charges on the purchase of July 1. July 8) Sold merchandise for $4,300 cash. July 8) The cost of the merchandise sold was $2,600. July 9) Purchased merchandise from Ryan Co. for $3,500 under credit terms of 2/15, 1/60, FOB destination, invoice dated July 9. July 11) Received a $700 credit memorandum from Ryan Co. for the return of part of the merchandise purchased on July 9. July 12) Received the balance due from Perry Co. for the invoice dated July 2, net of the discount July 16) Paid the balance due to Walker Company within the discount period. July 19) Sold merchandise to Clinton Co. for $3,800 under credit terms of 2/15, n/60, FOB shipping point, invoice dated July 19. July 19) The cost of the merchandise sold to Clinton Co. was $2,700 July 21) Issued a $800 credit memorandum to Clinton Co. for an allowance on goods sold on July 19. July 24) Paid Ryan Co the balance due, net of discount July 30) Received the balance due from Clinton Co. for the invoice dated July 19, net of discount. July 31) Sold merchandise to Perry Co. for $9,600 under credit terms of 2/10, n/60, FOB shipping point, invoice dated July 31. July 31) The cost of the merchandise sold to Perry Co. was $5,800 Total gross profit $ 0