Required information [The following information applies to the questions displayed below] At the beginning of Year 2, the Redd Company had the following balances in its accounts: Cash Inventory Land Common stock Retained earnings $23,300 4,500 3,000 19,000 11,800 During Year 2, the company experienced the following events: 1. Purchased inventory that cost $12,200 on account from Ross Company under terms 2/10, n/30. The merchandise was delivered FOB shipping point Freight costs of $900 were paid in cash. 2. Returned $950 of the inventory it had purchased from Ross Company because the inventory was damaged in transit The seller agreed to pay the return freight cost. 3. Paid the amount due on its account payable to Ross Company within the cash discount period. 4. Sold inventory that had cost $9,000 for $17,000 on account, under terms 2/10, n/45. 5. Received merchandise returned from a customer. The merchandise originally cost $1,700 and was sold to the customer for $2,100 cash. The customer was paid $2,100 cash for the returned merchandise. 6. Delivered goods FOB destination in Event 4. Freight costs of $790 were paid in cash. 7. Collected the amount due on the account receivable within the discount period. 8. Sold the land for $5,500. 9. Recognized accrued interest income of $750. (To record this entry, debit the asset account Interest Receivable (this account will be on the balance sheet in the asset section and does NOT get closed at year end) and credit the revenue account Interest Revenue (this account is a temporary revenue account recorded on the income statement that gets closed at year end). This entry will be discussed in future chapters and will NOT be tested on Test 2). 10. Took a physical count indicating that $3,600 of inventory was on hand at the end of the accounting period. (Hint: Determine the current balance in the inventory account before calculating the amount of the inventory write down.) b. Record the events in general journal format. Assume that the perpetual inventory method is used. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.)

Required Information [The following information applles to the questions disployed below] At the beginning of Year 2, the Redd Company had the following balances in lits accounts: During Year 2, the company experienced the following events: 1. Purchased inventory that cost $12,200 on account from Ross Company under terms 2N0,n30. The merchandise was delvered FOB shipping point Freight costs of $900 were paid in cash. 2 Retumed $950 of the inventory it had purchased from Ross Company because the inventory was damaged in transil: The seller agreed to pay the retum frelght cost. 3. Paid the amount due on its account payable to Ross Company within the cash discount period. 3. Paid the amount due on its account payabie to Ross Company wintontory that had cost $9,000 for $7,000 on account, under terms 2/10,n/45. 5. Recelved merchandise returned from a customer. The merchandise originally cost $1,700 and was sold to the customer for $2,100 cash. The customer was paid $2,100 cash for the returned merchandise. 6. Delivered goods FOB destination in Event 4. Freight costs of $790 were paid in cash. 7. Collected the amount due on the account recelvable within the discount penod. 8. Sold the land for $5,500. 8. Sold the land for $5,500. 9. Recognized accrued interest income of 5750 . (To record this enty, debilt the escet account Interest Recelvable (this account will be on the balance sheet in the asset section and does NOT get dosed at year end) and credit the revenue account Interest fievenue (his account is a temporay revenue account recorded on the income statement that gets closed at year end). This entry will be discussed in future chapters and will NOT be tested on Test 2). 10. Took a physical count indicating that $3,600 of inventory was on hand at the end of the accounting period. (Hant: Determine the current balance in the inventory account before calculating the amount of the inventory write down) b. Record the events in general journal format. Assume that the perpetual inventory method is used. (il no entry is required for a uransactonlevent, colect "No journal antry requitrad" In the first account fiald.)