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Presented below are selected transactions for Sarasota Company during September and October of the current year. Sarasota uses a perpetual inventory system and the earnings
Presented below are selected transactions for Sarasota Company during September and October of the current year. Sarasota uses a perpetual inventory system and the earnings approach. Sept. 1 Purchased merchandise on account from Hillary Company at a cost of $48,000, FOB destination, terms 1/15,n/30. 2 The correct company paid $2,000 of freight charges to Trucking Company on the September 1 merchandise purchase. 5 Returned for credit $3,000 of damaged goods purchased from Hillary Company on September 1. 15 Sold the remaining merchandise purchased from Hillary Company to Irvine Company for $90,000, terms 2/10,n/30, FOB destination. 16 The correct company paid $2,200 of freight charges on the September 1$ sale of merchandise. 17 Issued Irvine Company a credit of $6,000 for returned goods. These goods had cost Sarasota Company $3,000 and were returned to inventory. 25 Received the balance owing from Irvine Company for the September 15 sale. 30 Paid Hillary Company the balance owing for the September 1 purchase. Oct. 1 Purchased merchandise on account from Kimmel Company at a cost of $55,000, terms 2/10,n/30, FOB shipping point. 2 The correct company paid freight costs of $1,100 on the October 1 purchase. 3 Obtained a purchase allowance of \$2,600 from Kimmel Company to compensate for some minor damage to goods purchased on October 1. 10 Paid Kimmel Company the amount owing on the October 1 purchase. 11 Sold all of the merchandise purchased from Kimmel Company to Kieso Company for $105,000, terms 2/10,n/30
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