Purchase-Related Transactions

Warwicks Co., a women's clothing store, purchased $21,000 of merchandise from a supplier on account, terms FOB destination, 2/10, n/30. Warwicks returned $2,900 of the merchandise, receiving a credit memo, and then paid the amount due within the discount period.

a. Journalize Warwicks Co.'s entry to record the purchase.

	Merchandise Inventory
	Accounts Payable

b. Journalize Warwicks Co.'s entry to record the merchandise return.

	Accounts Payable
	Merchandise Inventory

c. Journalize Warwicks Co.'s entry to record the payment.

	Accounts Payable
	Cash