Prepare journal entries to record the following merchandising transactions of Clinton's, which uses the perpetual inventory system. August 1 Purchased merchandise from Lee Company for $12,300 under credit terms of 1/10, n/30, FOB destination, invoice dated August 1. August 5 Sold merchandise to Wright Corporation for $7,600 under credit terms of 2/10, n/60, FOB destination, invoice dated August 5. The merchandise had cost $4,600. August 8 Purchased merchandise from Sanchez Corporation for $6,360 under credit terms of 1/10, n/45, FOB shipping point, invoice dated August 8. August 9 Paid $925 cash for shipping charges related to the August 5 sale to Wright Corporation August 10 Wright returned merchandise from the August 5 sale that had cost Clinton's $300 and was sold for $600. The merchandise was restored to inventory. August 12 After negotiations with Sanchez Corporation concerning problems with the purchases on August 8, Clinton's received a credit memorandum from Sanchez granting a price reduction of $900 off the $6,360 of goods purchased. August 14 At Lee's request, Clinton's paid $600 cash for freight charges on the August 1 purchase, reducing the amount owed to Lee. August 15 Received balance due from Wright Corporation for the August 5 sale less the return on August 10. August 18 Paid the amount due Sanchez Corporation for the August 8 purchase less the price allowance from August 12. August 19 Sold merchandise to Martin Company for $4,300 under credit terms of n/10, FOB shipping point, invoice dated August 19. The merchandise had cost $2,150. August 22 Martin requested a price reduction on the August 19 sale because the merchandise did not meet specifications. Clinton's sent Martin a $500 credit memorandum toward the $4,300 invoice to resolve the issue. August 29 Received Martin's cash payment for the amount due from the August 19 sale less the price allowance from August 22. August 30 Paid Lee Company the amount due from the August 1 purchase. Prepare a multiple-step income statement. Clinton's Company Income Statement For the Month Ended August 31, 2021 Operating expenses: Net income EA $ 0 $ 0 0 0 0 0 Aug. 1) Purchased merchandise from Lee Company for $12,300 under credit terms of 1/10, n/30, FOB destination, invoice dated August 1. Aug. 5) Sold merchandise to Wright Corporation for $7,600 under credit terms of 2/10, n/60, FOB destination, invoice dated August 5. Aug. 5) The merchandise sold to Wright had cost $4,600. Aug. 8) Purchased merchandise from Sanchez Corporation for $6,360 under credit terms of 1/10, n/45, FOB shipping point, invoice dated August 8. Aug. 9) Paid $925 cash for shipping charges related to the August 5 sale to Wright Corporation Aug. 10) Wright returned merchandise from the August 5 sale that had sold for $600. Aug. 10) The cost of the merchandise returned by Clinton's was $300. The merchandise was restored to inventory. Aug. 12) After negotiations with Sanchez Corporation concerning problems with the purchases on August 8, Clinton's received a credit memorandum from Sanchez granting a price reduction of $900 off the $6,360 of goods purchased. Aug. 14) At Lee's request, Clinton's paid $600 cash for freight charges on the August 1 purchase, reducing the amount owed to Lee. Aug. 15) Received balance due from Wright Corporation for the August 5 sale less the return on August 10. Aug. 18) Paid the amount due Sanchez Corporation for the August 8 purchase less the price allowance from August 12. Aug. 19) Sold merchandise to Martin Company for $4,300 under credit terms of n/10, FOB shipping point, invoice dated August 19. Aug. 19) The cost of the merchandise sold merchandise to Martin was $2,150. Aug. 22) Martin requested a price reduction on the August 19 sale because the merchandise did not meet specifications. Clinton's sent Martin a $500 credit memorandum toward the $4,300 invoice to resolve the issue. Aug. 29) Received Martin's cash payment for the amount due from the August 19 sale less the price allowance from August 22. Aug. 30) Paid Lee Company the amount due from the August 1 purchase. Total income Impact on income Increase (decrease) to income $ 0