Problem 5-1A Preparing journal entries for merchandising activities-perpetual system 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 $6,700 under credit terms of 2/15, 1/30, FOB shipping point, invoice dated July 1. 2. Sold merchandise to Creek Co. for $1,000 under credit terms of 2/10, 0/60, FOB shipping point, Invoice dated July 2. The merchandise had cost $558. * Paid $125 cash for freight charges on the purchase of July 1. & Sold merchandise that had cost $2,000 for $2,400 cash. 9 Purchased merchandise from Leight Co. for $2,700 under credit terns of 2/15, n/60, Foe destination, Invoice dated July 9. 11 Received a $700 credit memorandum fron Leight Co, for the return of part of the merchandise purchased on July 9. 12 Received the balance due from Creek Co. for the invoice dated July 2, net of the discount 16 Paid the balance due to Boden Company within the discount period. 19 Sold merchandise that cost $1,200 to Art coi for $1,800 under credit terms of 2/15, 1/60) FOB shipping point, invoice dated July 19 21 Issued a $300 credit memorandum to Art Co. for an allowance on Boods sold on July 19, 24 Paid Leight Co. the balance due, net of discount 30 Received the balance due from Art Co. for the invoice dated July 19, net of discount 31 Sold merchandise that cost $5,500 to Creek Co. for $7,000 under credit terns of 2/10, 1/60, FOB shipping point, invoice dated July 31. Journal entry worksheet