Journal Entries

Required information PB6-1 Reporting Purchase Transactions between Wholesale and Retail Merchandisers Using Perpetual Inventory Systems (LO 6-3) [The following information applies to the questions displayed below.) The transactions listed below are typical of those involving Southern Sporting Goods (SSG) and Sports R Us (SRU), SSG is is a retail merchandiser. Assume all sales of merchandise from SSG to SRU are made with terms n/30, and the two companies use perpetual Inventory systems. Assume the following transactions between the two companies occurred in the order listed during the year ended December 31 a. SSG sold merchandise to SRU ata selling price of $125,000. The merchandise had cost SSG $94,000. 6. Two days later, SRU complained to SSG that some of the merchandise differed from what SRU had ordered. SSG agreed to give an allowance of $3,000 to SRU. SRU also returned some sporting goods, which had cost SSG $12,000 and had been sold to SRU for $16,500. Just three days later SRU paid SSG, which settled all amounts owed. PB6-1 Part 2 2. Prepare the journal entries that SRU would record. (If no entry is required for a transaction/event, select "No Journal Entry Required" in the first account field.) 1 Record the inventory purchased of $125,000 on account. 2 Record the return of unsatisfactory merchandise for which credit was given. 3 Record the payment in full