Question
Littleton Books has the following transactions during May. May 2 Purchases books on account from Readers Wholesale for $3,900, terms 2/10, n/30. May 3 Pays
Littleton Books has the following transactions during May.
May 2 Purchases books on account from Readers Wholesale for $3,900, terms 2/10, n/30. May 3 Pays cash for freight costs of $260 on books purchased from Readers. May 5 Returns books with a cost of $400 to Readers because part of the order is incorrect. May 10 Pays the full amount due to Readers. May 30 Sells all books purchased on May 2 (less those returned on May 5) for $4,600 on account.
1. Record the transactions of Littleton Books, assuming the company uses a periodic inventory system.
2. Record the period-end adjustment to cost of goods sold on May 31, assuming the company has no beginning or ending inventory.
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