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Part A (14 marks) < The following were selected from among the transactions completed by Essex Company during July of the current year: < July
Part A (14 marks) < The following were selected from among the transactions completed by Essex Company during July of the current year: < July 5 6 < 7 < 8 < 10 < 15 20 < 21 < 22 < 25 < 27 Purchased merchandise on account from Kester Ltd for $33,450, under the terms of 2/10, n/30, FOB shipping point, invoice dated July 5. < Sold merchandise on account to Parsley Ltd for $36,000, under the terms of 1/15, n/45, FOB destination, invoice dated July 6. The cost of the merchandise sold was $25,000. < Paid $1,000 cash for shipping charges on the purchase of July 5. < Paid $1,200 cash for shipping charges related to the sale to Parsley Ltd on July 6. < Returned $6,850 of merchandise purchased on July 5 from Kester Ltd. Paid Kester Ltd on account for purchase of July 5, less return of July 10. < Received cash on account from sale of July 6 to Parsley Ltd. < Purchased merchandise on account from Delta Ltd for $91,200, under the terms of 2/10, n/30, FOB destination, invoiced dated July 30. < Upon the request of Delta Ltd, Essex Company paid $1,500 for shipping charges on the purchases on July 21, reducing the amount owned to Delta Ltd. < Paid Parsley Ltd a cash refund of $7,150 for returned merchandise from sale of July 6. The returned merchandise is not defective, and its cost was $4,250. < After negotiations with Delta Ltd regarding problems with the purchases on July 21, Essex Company received a price reduction from Delta Ltd of $5,000 off the $91,200 of merchandise purchased. < Required: (Explanation is NOT required) < Prepare journal entries for the above merchandising transactions of Essex Company, assuming it uses a perpetual inventory system and the gross method
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