Prepare journal entries to record the following merchandising transactions of Mitchell's, which uses the perpetual inventory system and the gross method. (Hint: It will help to identify each receivable and payable; for example, record the purchase on July 1 in Accounts Payable-Taylor.) July 1 Purchased merchandise from Taylor Company for $10,000 under credit terms of 1/15, n/30, FOB shipping point, invoice dated July 1. July 2 Sold merchandise to Lane Company for $2,900 under credit terms of 2/10, n/60, FOB shipping point, invoice dated July 2. The merchandise had cost $1,740. July 3 Paid $925 cash for freight charges on the purchase of July 1. July 8 Sold merchandise that had cost $3,400 for $5,700 cash. July 9 Purchased merchandise from Cabela Company for $4,200 under credit terms of 2/15, n/60, FOB destination, invoice dated July 9. July 11 Returned $800 of merchandise purchased on July 9 from Cabela Company and debited its account payable for that amount. July 12 Received the balance due from Lane Company for the invoice dated July 2, net of the discount. July 16 Paid the balance due to Taylor Company within the discount period. July 19 Sold merchandise that cost $3,600 to Walker Company for $5,200 under credit terms of 2/15, n/60, FOB shipping point, invoice dated July 19. July 21 Gave a price reduction (allowance) of $1,000 to Walker Company for merchandise sold on July 19 and credited Walker's accounts receivable for that amount. July 24 Paid Cabela Company the balance due, net of discount. July 30 Received the balance due from Walker Company for the invoice dated July 19, net of discount. July 31 Sold merchandise that cost $6,600 to Lane Company for $11,000 under credit terms of 2/10, n/60, F08 shipping point, invoice dated July 31. Requirement General Journal General Ledger Trial Balance Schedule of Receivables Schedule of Payables Income Statement Impact on Income General Journal tab Journalize the merchandising transactions. The General Ledger, trial balance and schedules of accounts receivable and accounts payable will be updated based on your entries. General Ledger tab-One of the advantages of general ledger software is that posting is done automatically. To see the detail of all transactions that affect a specific account, or the balance in an account at a specific point in time, click on the General Ledger tab. Trial Balance tab General ledger software also automates the preparation of trial balances. A trial balance lists each account from the General Ledger, along with its balance, either a debit or a credit. Total debits should always equal total credits. Schedule of Receivables tab General Ledger sofware automates the balances for each of the customer's accounts. Prev 1 of 2 Next >