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 $6,500 under credit terna of 2/15, 1/30, POD whipping point, invoice dated July 1. 2 Bold merchandise to Creek Co. for $1,000 under credit term of 2/10, 1/60, POB shipping point, Invoice dated July 2. The merchandise had cost $542. 3 Paid $135 cash for freight charges on the purchase of July 1. & Sold merchandise that had cost $1,800 for $2,200 cash. 9 Purchased merchandise from Leight Co. for $3,000 under credit terms of 2/15, n/60, POB destination, invoice dated July 9. 11 Returned $1,000 of merchandise purchased on July 9 from Leight Co., and debited ito account payable for that amount. 12 Received the balance due fron 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 $800 to Art Co. for $1,200 under credit terms of 2/15, n/60, FOB shipping point invoice dated July 19. 21 Cave a price reduction (allowance) of $200 to Art Co. for merchandise wold on July 19, and credited Art's accounts receivable for that amount. 24 Paid Leight Co. the balance due, not of discount 30 Received the balance due from Art Co. for the invoice dated July 19, net of discount. 31 Bold merchandise that cost $5,300 to Creek Co. for $7.400 under credit term of 2/10, n/60, TO whipping point invoice dated July 31. # Credit Date General Journal Debit July 02 1,000 Accounts receivable-Creek Cost of goods sold Record entry Clear entry View general journal