Problem $4-2$A $($Algo$)$ Preparing journal entries for merchandising activities LO P$1,$ P$2$

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

August $1$ Purchased merchandise from Aron Company for $$8,000$ under credit terms of $1/10,$ n$/30,$ FOB destination, invoice dated August $1.$

August $5$ Sold merchandise to Baird Corporation for $$5,600$ under credit terms of $2/10,$ n$/60,$ FOB destination, invoice dated August $5.$ The merchandise had cost $$4,000.$

August $8$ Purchased merchandise from Waters Corporation for $$7,000$ under credit terms of $1/10,$ n$/45,$ FOB shipping point, invoice dated August $8.$

August $9$ Paid $$230$ cash for shipping charges related to the August $5$ sale to Baird Corporation.

August $10$ Baird returned merchandise from the August $5$ sale that had cost Lowe$$s $$500$ and was sold for $$1,000.$ The merchandise was restored to inventory.

August $12$ After negotiations with Waters Corporation concerning problems with the purchases on August $8,$ Lowe$$s received a price reduction from Waters of $$700$ off the $$7,000$ of goods purchased. Lowe's debited accounts payable for $$700.$

August $14$ At Aron$$s request, Lowe$$s paid $$360$ cash for freight charges on the August $1$ purchase, reducing the amount owed $($accounts payable$)$ to Aron.

August $15$ Received balance due from Baird Corporation for the August $5$ sale less the return on August $10.$

August $18$ Paid the amount due Waters Corporation for the August $8$ purchase less the price allowance from August $12.$

August $19$ Sold merchandise to Tux Company for $$4,800$ under credit terms of n$/10,$ FOB shipping point, invoice dated August $19.$ The merchandise had cost $$2,400.$

August $22$ Tux requested a price reduction on the August $19$ sale because the merchandise did not meet specifications. Lowe$$s gave a price reduction $($allowance$)$ of $$800$ to Tux and credited Tux's accounts receivable for that amount.

August $29$ Received Tux$$s cash payment for the amount due from the August $19$ sale less the price allowance from August $22.$

August $30$ Paid Aron Company the amount due from the August $1$ purchase.