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Prepare journal entries to record the following merchandising transactions of Perez's, which uses the perpetual inventory system. (Hint: It will help to identify each receivable
Prepare journal entries to record the following merchandising transactions of Perez's, which uses the perpetual inventory system. (Hint: It will help to identify each receivable and payable; for example, record the purchase on August 1 in Accounts PayableParker.)
August 1 | Purchased merchandise from Parker Company for $9,300 under credit terms of 1/10, n/30, FOB destination, invoice dated August 1. |
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August 5 | Sold merchandise to Clark Corporation for $6,100 under credit terms of 2/10, n/60, FOB destination, invoice dated August 5. The merchandise had cost $3,700. |
August 8 | Purchased merchandise from Lee Corporation for $5,760 under credit terms of 1/10, n/45, FOB shipping point, invoice dated August 8. |
August 9 | Paid $325 cash for shipping charges related to the August 5 sale to Clark Corporation |
August 10 | Clark returned merchandise from the August 5 sale that had cost Perez's $100 and was sold for $200. The merchandise was restored to inventory. |
August 12 | After negotiations with Lee Corporation concerning problems with the purchases on August 8, Perez's received a credit memorandum from Lee granting a price reduction of $700 off the $5,760 of goods purchased. |
August 14 | At Parker 's request, Perez's paid $600 cash for freight charges on the August 1 purchase, reducing the amount owed to Parker. |
August 15 | Received balance due from Clark Corporation for the August 5 sale less the return on August 10. |
August 18 | Paid the amount due Lee Corporation for the August 8 purchase less the price allowance from August 12. |
August 19 | Sold merchandise to Clinton Company for $4,000 under credit terms of n/10, FOB shipping point, invoice dated August 19. The merchandise had cost $2,000. |
August 22 | Clinton requested a price reduction on the August 19 sale because the merchandise did not meet specifications. Perez's sent Clinton a $400 credit memorandum toward the $4,000 invoice to resolve the issue. |
August 29 | Received Clinton's cash payment for the amount due from the August 19 sale less the price allowance from August 22. |
August 30 | Paid Parker Company the amount due from the August 1 purchase. |
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