Table 7-2

Pan Company had the following transactions occur during May 20X9.

May 2 Inventory was purchased on account for $5,000, terms 2/10, n/30.

May 3 Inventory costing $1,000 was returned.

May 9 Pan Company paid for the inventory.

May 15 Inventory costing $2,200 was sold on account for $3,800, terms 3/10, n/45.

May 31 Closing entries are prepared for the month-end financial statements.

11) Referring to Table 7-2, if Pan Company were using the periodic inventory system, what is the journal entry for May 9?

A) Accounts Payable 4,000

Inventory 100

Cash 3,900

B) Accounts Payable 4,000

Inventory 80

Cash 3,920

C) Accounts Payable 5,000

Inventory 100

Cash 4,900

D) Accounts Payable 4,000

Cash Discounts on Purchases 100

Cash 3,900

E) Accounts Payable 4,000

Cash Discounts on Purchases 80

Cash 3,920

12) Referring to Table 7-2, if Pan Company were using a perpetual inventory system, what is the journal entry for May 15?

A) Accounts Receivable 3,800

Sales 3,800

B) Accounts Receivable 3,800

Sales 3,800

Cost of Goods Sold 2,134

Cash Discounts on Sales 66

Inventory 2,200

C) Accounts Receivable 3,800

Sales 3,800

Cost of Goods Sold 2,200

Inventory 2,200

D) Accounts Receivable 3,686

Cash Discount on Sales 114

Sales 3,800

E) Accounts Receivable 3,686

Cash Discount on Sales 114

Sales 3,800

Cost of Goods Sold 2,200

Inventory 2,200

13) Referring to Table 7-2, if Pan Company were using a periodic inventory system, what is the journal entry on May 15?

A) Accounts Receivable 3,800

Sales 3,800

B) Accounts Receivable 3,800

Sales 3,800

Cost of Goods Sold 2,134

Cash Discounts on Sales 66

Inventory 2,200

C) Accounts Receivable 3,800

Sales 3,800

Cost of Goods Sold 2,200

Inventory 2,200

D) Accounts Receivable 3,686

Cash Discount on Sales 114

Sales 3,800

E) Accounts Receivable 3,686

Cash Discount on Sales 114

Sales 3,800

Cost of Goods Sold 2,200

Inventory 2,200

14) Referring to Table 7-2, if Pan Company were using a periodic inventory system, what is the journal entry to close sales on May 31?

A) Sales 3,800

Cost of Goods Sold 3,800

B) Cost of Goods Sold 3,800

Sales 3,800

C) Income Summary 3,800

Sales 3,800

D) Sales 3,800

Income Summary 3,800

E) No entry is necessary on a monthly basis.