Question
Scott Ltd buys towels for $50 each and sells them for $80 each. Scott Ltd completed the below transactions below during January 2020: Jan 1
- Scott Ltd buys towels for $50 each and sells them for $80 each. Scott Ltd completed the below transactions below during January 2020:
| Jan 1 | Purchased 30 towels. Terms 2/10, n/30 from Bark Ltd. EXW suppliers warehouse.
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| Jan 2 | Paid freight of $100 on Jan 1 purchase.
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| Jan 3 | Sold 5 towels to Yellow Ltd on account. Terms 4/10, n/30
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| Jan 7 | Returned 10 towels purchased 1 Jan and paid the remaining amount due.
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| Jan 8 | Received payment from Yellow Ltd for the amount due on Jan 3 sale.
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Required:
Ignore GST. Show supporting calculations.
Prepare the general journal entries to record the above transactions assuming a FIFO perpetual inventory system is used.
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Core Concepts of Accounting
Authors: Cecily A. Raiborn
2nd edition
470499478, 978-0470499474
