Piper Specialty Store Ltd. completed the following merchandising transactions in the month of May 2021. At the beginning of May, Piper's ledger showed Cash $10,400; Accounts Receivable $3,600; Inventory $5,200; Common Shares $11,200; and Retained Earnings $8,000. Piper Specialty has experienced a return rate of 2% of sales and uses a perpetual inventory system. 1 May 3 4 7 8 9 11 14 Purchased merchandise on account from Depot Wholesale Supply Ltd. for $7,040, terms 1/10, n/30, FOB shipping point. Freight charges of $188 were paid by the appropriate party on the merchandise purchased on May 1. Sold merchandise on account to Yip Company for $5,200, terms n/30, FOB destination. The cost of the merchandise was $4,100. Freight charges of $120 were paid by the appropriate party on the May 4 sale. Received a $140 credit from Depot Wholesale Supply when merchandise was returned. Paid Depot Wholesale Supply in full. Purchased supplies for $560 cash. Received payment in full from Yip Company for merchandise sold on account on May 4. Collected $1,280 of the accounts receivable outstanding at the beginning of the month. All accounts were originally sold on terms of n/30. Purchased merchandise from Harlow Distributors Inc. for $4,000, terms n/30, FOB destination. Freight of $64 was paid by the appropriate party on the May 18 purchase of merchandise. Sold merchandise to various customers for $10,000 cash. The cost of the merchandise was $5,500. Paid a $128 cash refund to customers for returned merchandise. The cost of the returned merchandise was $72. It was restored to inventory. A physical inventory count was taken and determined that there was $6,480 of inventory on hand. Prepare any adjustment required. 15 18 21 22 29 31 Record the May transactions. (List all debit entries before credit entries. Credit account titles are automatically indented when the amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter for the amounts.) Date Account Titles and Explanation Debit Credit May 1 Inventory 7,040 Accounts Payable 7,040 May 3 Inventory 188 Cash 188 May 4 Accounts Receivable 5,200 Sales 5096 Refund Liability 104 (Sale of goods on account) May 4 Cost of Goods Sold Estimated Inventory Returns Inventory (Cost of goods sold recorded) May 7 Freight Out 120 Cash 120 May 8 Accounts Payable 140 Inventory 140 May 9 Accounts Payable Cash Inventory May 11 Supplies 560 Cash 560 May 14 Cash 5200 Accounts Receivable 5200 May 15 Cash 1280 Accounts Receivable 1280 May 18 Inventory 4000 Accounts Payable 4000 May 21 No Entry No Entry 0 May 22 Cash 10000 Sales 9800 Refund Liability 200 ( Sale of goods) May 22 Cost of Goods Sold Estimated Inventory Returns Inventory (Cost of goods sold recorded) May 29 Refund Liability 128 Cash 128 (Return of merchandise) May 29 Inventory 72 Estimated Inventory Returns 72 (Return of merchandise, assuming goods are resaleable and returned to inventory) May 31 V Cost of Goods Sold Inventory
