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Problem 5: (12 points) On May 11, Vegas Co. accepts delivery of $40,000 of merchandise it purchases for resale from Troy Corporation. With the merchandise
Problem 5: (12 points) On May 11, Vegas Co. accepts delivery of $40,000 of merchandise it purchases for resale from Troy Corporation. With the merchandise is an invoice dated May 11, with terms of 3/10.190. FOB shipping point. The goods cost Troy $30,000. When the goods are delivered. Vegas pays $345 to Express Shipping for delivery charges on the merchandise. On May 12, Vegas returns $1.400 of goods to Troy, who receives them one day later and restores them to inventory. The returned goods had cost Troy $800. On May 20, Vegas mails a check to Troy Corporation for the amount owed. Troy receives it the following day. (Both Sydney and Troy use a perpetual inventory system.) 1. Prepare journal entries that Vegas Co. records for these transactions. 2. Prepare journal entries that Troy Corporation records for these transactions
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