P5-46A Record merchandising transactions, prepare financial statements, and calculate gross profit ratio: perpetual inventory system (LO 1, 2, 4, 6) The following transactions occurred during July 2010 at Tinys Sports Shop

July 2 Purchased weights on credit from Barbells Company for $900, with terms 3/10, n/30

July 4 Paid freight of $75 on the July purchase

July 8 Sold merchandise to members on credit for $500, terms n/45. The merchandise sold cost $425

July 9 Received credit of $50 from Barbells for damaged goods that were returned

July 11 Purchased workout equipment from Spinners for cash for $2,000

July 13 Paid Barbells Company in full

July 15 Purchased gloves and workout belts from Get Pumped on credit for $1,000, terms 5/15, n/60

July 17 Received credit of $25 from Get Pumped for damaged merchandise

July 19 Sold merchandise to members on account, $750, terms n/15. The cost of the merchandise sold was $250

July 20 Received $700 in cash payment on account from members

July 23 Paid Get Pumped in full

July 27 Granted an allowance of $50 to members for gear that didnt work properly

July 29 Received $400 in cash payments on account from members

July 31 Paid cash operating expenses of $500 for the month

Requirements

1.Suppose Tinys Sports Shop started the month with cash of $8,000, merchandise inventory of $2,000, and common stock of $10,000. Enter each transaction into the accounting equation, assuming Tinys Sports Shop uses a perpetual inventory system.