Prepare journal entries to record the following merchandising transactions of Knight's, which uses the perpetual inventory system and the gross method.

July $1$ Purchased merchandise from Hall Company for $$10,200$ under credit terms of $1/15,$ n$/30,$ FOB shipping point, invoice dated July $1.$

July $2$ Sold merchandise to Walker Company for $$3,000$ under credit terms of $2/10,$ n$/60,$ FOB shipping point, invoice dated July $2.$ The merchandise had cost $$1,800.$

July $3$ Paid $$965$ cash for freight charges on the purchase of July $1.$

July $8$ Sold merchandise that had cost $$3,500$ for $$5,900$ cash.

July $9$ Purchased merchandise from Brown Company for $$4,300$ under credit terms of $2/15,$ n$/60,$ FOB destination, invoice dated July $9.$

July $11$ Returned $$900$ of merchandise purchased on July $9$ from Brown Company and debited its account payable for that amount.

July$12$ Received the balance due from Walker Company for the invoice dated July $2,$ net of the discount.

July $16$ Paid the balance due to Hall Company within the discount period.

July $19$ Sold merchandise that cost $$3,800$ to Wilson Company for $$5,400$ under credit terms of $2/15,$ n$/60,$ FOB shipping point, invoice dated July $19.$

July $21$ Gave a price reduction $($allowance$)$ of $$1,100$ to Wilson Company for merchandise sold on July $19$ and credited Wilson$$s accounts receivable for that amount.

July $24$ Paid Brown Company the balance due, net of discount.

July $30$ Received the balance due from Wilson Company for the invoice dated July $19,$ net of discount.

July $31$ Sold merchandise that cost $$6,700$ to Walker Company for $$11,200$ under credit terms of $2/10,$ n$/60,$ FOB shipping point, invoice dated July $31.$ For each transaction, indicate the impact each item had on income and the dollar amount of the change in income, if any. Decreases in net income should be entered with a minus sign. Upon completion, compare the gross profit with the amount reported on the partial income statement.