Journal Entries for Merchandise Transactions on Seller's and Buyer's Books-Perpetual System The following are selected transactions for Kim, Inc., during the month of June: June 21 Sold and shipped on account to Lowery Company, $4,000 ($2,000 cost) of merchandise, with terms of 2/10, 1/30. 28 Lowery Company returned defective merchandise billed at $400 on June 21 ($200 cost.) 30 Received from Lowery Company a check for full settlement of the June 21 transaction. Required Prepare the necessary journal entries for (a) Kim, Inc., and (b) Lowery Company. Both companies use the perpetual inventory system. Seller's Journal Entries Buyer's Journal Entries KIM, INC. GENERAL JOURNAL Description Debit Credit Date June 21 Sold merchandise to Lowery Company terms 2/10, 1/30. 21 Cost of merchandise sold to Lowery Company 28 Merchandise returned by Lowery Company 28 Cost of merchandise returned by Lowery Company. 30 Sales Discounts Received amount due from Lowery Company