Problem 4-1A (Algo) Preparing journal entries for merchandising activities LO P1, P2 Prepare journal entries to record the following merchandising transactions of Cabela'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-Boden. July 1 Purchased merchandise from Boden Company for $6,300 under credit terms of 2/15, n/30, FOB shipping point, invoice dated July 1. July 2 Sold merchandise to Creek Company for $950 under credit terms of 2/10, n/60, FOB shipping point, invoice dated July 2. The merchandise had cost $525. July 3 Paid $110 cash for freight charges on the purchase of July 1. July 8 Sold merchandise that had cost $1,600 for $2,000 cash. July 9 Purchased merchandise from Leight Company for $2,900 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 Leight Company and debited its account payable for that amount. July 12 Received the balance due from Creek Company for the invoice dated July 2, net of the discount. July 16 Paid the balance due to Boden Company within the discount period. July 19 Sold merchandise that cost $1,000 to Art Company for $1,500 under credit terms of 2/15, n/60, FOB shipping point, invoice dated July 19. July 21 Gave a price reduction (allowance) of $250 to Art Company for merchandise sold on July 19 and credited Art's accounts receivable for that amount. July 24 Paid Leight Company the balance due, net of discount. July 30 Received the balance due from Art Company for the invoice dated July 19, net of discount. July 31 Sold merchandise that cost $5,100 to Creek Company for $7,200 under credit terms of 2/10, n/60, FOB shipping point, invoice dated July 31. View transaction list Journal entry worksheet 1 2 3 4 5 6 7 8 17 > Purchased merchandise from Boden Company for $6,300 under credit terms of 2/15, n/30, FOB shipping point, invoice dated July 1. Note: Enter debits before credits. Date July 01 General Journal Debit Credit Merchandise inventory Accounts payable-Boden Record entry Clear entry View general journal