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Required information Use the following information for the Exercises below. The following information applies to the questions displayed below.) Allied Merchandisers was organized on May
Required information Use the following information for the Exercises below. The following information applies to the questions displayed below.) Allied Merchandisers was organized on May 1. Macy Company is a major customer (buyer) of Aled (seller) products. May 3 Allied made its first and only purchase of inventory for the period on May 3 for 3,000 units at a price of $9 cash per unit (for a total cost of $27,000). May 5 Allied sold 1,500 of the units in inventory for $13 per unit invoice total: $19,500) to Macy Company under credit terms 2/10, 1/60. The goods cost Allied $13,500. May 7 Macy returns 150 units because they did not fit the customer's needs (invoice amount: $1,950). Allied restores the units, which cost $1,350, to its inventory. May 8 Macy discovers that 150 units are scuffed but are still of use and, therefore, keeps the units. Allied gives a price reduction (allowance) and credits Macy's accounts receivable for $750 to compensate for the damage. May 15 Allied receives paynent from Macy for the amount owed on the May 5 purchase; payment is net of returns, allowances, and any cash discount. Exercise 5-8 (Algo) Recording purchases, purchases returns, and purchases allowances LO P1 Prepare the appropriate journal entries for Macy Company to record each of the May transactions. Macy is a retailer that uses the gross method and a perpetual inventory system; it purchases these units for resale. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.) Answer is not complete. Debit No Credit General Journal Date 27,000 1 May 03 Merchandise inventory Cash 27,000 2 May 05 19,500 19,500 Accounts receivable Sales Cost of goods sold Merchandise inventory 13,500 13,500 19,500 3 May 07 Sales returns and allowances Accounts receivable 19,500 X 750 4 May 08 Purchases returns and allowances Accounts receivable > 750 16,800 5 May 15 Cash Accounts receivable 16,800
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