May 25 Inventory 730 Accounts Payable 730 May 27 TAccounts Payable 1,100 Inventory Cash 1,078 May 29 TSales Returns and Allowan 70 Cash 70 To record merchandise returned) 20 Inventory 20 Cost of Goods Sold (To record cost of merchandise returned) May 31 TAccounts Receivable 1,090 Sales Revenue (To record credit sale) Cost of Goods Sold 1,090 560 Inventory 560 (To record cost of merchandise sold) Problem 5-2A (Part Level Submission) Latona Hardware Store completed the following merchandising transactions in the month of May. At the beginning of May, the ledger of Latona showed Cash of $5,220 and Common Stock of $5,220 May 1 Purchased merchandise on account from Gray's Wholesale Supply $4,400, terms 1/10, n/30 2 Sold merchandise on account $1,900, terms 1/10, n/30. The cost of the merchandise sold was $1,410 5 Received credit from Gray's Wholesale Supply for merchandise returned $200 9 Received collections in full, less discounts, from customers billed on sales of $1,900 on May 2 10 Paid Gray's Wholesale Supply in full, less discount. 11 Purchased supplies for cash $300 12 Purchased merchandise for cash $1,300 15 Received refund for poor quality merchandise from supplier on cash purchase $170 17 Purchased merchandise from Amland Distributors $1,100, FOB shipping point, terms 2/10, n/30 19 Paid freight on May 17 purchase $190 24 Sold merchandise for cash $3,000. The merchandise sold had a cost of $1,920 25 Purchased merchandise from Horvath, Inc. $730, FOB destination, terms 2/10, n/30 27 Paid Amland Distributors in full, less discount. 29 Made refunds to cash customers for defective merchandise $70. The returned merchandise had a fair value of $20 31 Sold merchandise on account $1,090, terms n/30. The cost of the merchandise sold was $560 Latona Hardware's chart of accounts includes the following: No. 101 Cash, No. 112 Accounts Receivable, No. 120 Inventory, No. 126 Supplies, No. 201 Accounts Payable, No. 311 Common Stock, No. 401 Sales Revenue, No. 412 Sales Returns and Allowances, No. 414 Sales Discounts, and No. 505 Cost of Goods Sold Journalize the transactions using a perpetual inventory system. (Credit account titles are automatically indented when amount is entered. Do not indent manually. Date Account Titles and Explanation May 1 TInventory Debit Credit 4,400 Accounts Payable 4,400 May 2 TAccounts Receivable 1,900 1,900 Sales Revenue (To record credit sale) Cost of Goods Sold 1,410 Inventory 1,410 To record cost of merchandise sold) May 5 TAccounts Payable 200 Inventory 200 May 9 TCash 1,881 Sales Discounts 19 1,900 Accounts Receivable May 1TAccounts Payable 4,200 Inventory 42 Cash 4,158 May 11 Supplies 300 Cash 300 May 12 TInventory 1,300 Cash 1,300 May 15 TCash 170 Inventory 170 May 17 TInventory 1,100 Accounts Payable 1,100 May 19 TInventory 190 190 Cash May 24 TCash 3,000 Sales Revenue 3,000 To record cash sale) 1,920 Cost of Goods Sold 1,920 Inventory (To record cost of merchandise sold) May 25 TInventory 730 Enter the beginning cash and common stock balances and post the transactions. (Post entries in the order of journal entries presented in the previous question.) No. 101 Explanation Ref Balance Date Debit Credit Balance JI 01 JI 01 Accounts Receivable No. 112 Credit Date Explanation Ref Debit Balance No. 120 Date Explanation Ref Debit Balance 01 31 01 01 01 01 01 01 31 01 Supplies No. 126 Balance Explanation Ref Deblt Credit Date Accounts Payable No. 201 Explanation Ref Date Debit Credit Balance JI 01 01 01 Common Stock No. 311 Explanation Ref Debit Credit Date Balance Balance Sales Revenue No. 401 Date Explanation Ref Debit Credit Balance 01 Sales Returns and Allowances No. 412 Date Explanation Ref Debit Credit Balance Sales Discounts No. 414 Explanation Ref Date Debit Credit Balance JI Cost of Goods Sold No. 505 Date Explanation Ref Debit Credit Balance 01 01