PART A.

Presented below are transactions related to Wildhorse Company. Prepare the journal entries to record these transactions on the books of Wildhorse Company using a perpetual inventory system. (Credit account titles are automatically indented when amount is entered. Do not indent manually.)

1. On December 3, Wildhorse Company sold $593,600 of merchandise on account to Novak Co., terms 4/10, n/30, FOB destination. Wildhorse paid $430 for freight charges. The cost of the merchandise sold was $383,200. 2. On December 8, Novak Co. was granted an allowance of $29,300 for merchandise purchased on December 3.

3. On December 13, Wildhorse Company received the balance due from Novak Co. Collapse question part (a) Prepare the journal entries to record these transactions on the books of Wildhorse Company using a perpetual inventory system. (Credit account titles are automatically indented when amount is entered. Do not indent manually.)

PART B.

b. Assume that Wildhorse Company received the balance due from Novak Co. on January 2 of the following year instead of December 13. Prepare the journal entry to record the receipt of payment on January 2. (Credit account titles are automatically indented when amount is entered. Do not indent manually.)

Account Titles and Explanation No. Date Debit Credit Dec. 3 Account receivable 593600 1. 593600 Sales revenue (To record credit sale) Dec. 3 Cost of Goods Sold 383200 383200 Inventory (To record cost of merchandise sold) Freight-Out 430 Dec. 3 cash 430 (To record freight charges) Sales return and allowance 2. Dec. 8 29300 Account receivable 29300 Dec. 13 541728 3. Cash Sales Discounts 22572 Account receivable 564300 Account Titles and Explanation Debit Credit No. Date Dec. 3 1. (To record credit sale) Dec. 3 (To record cost of merchandise sold) Dec. 3 (To record freight charges) 2. Dec. 8 Dec. 13 3