Question
The Bike and Hike Outlet is a retail store. Transactions involving purchases and cash payments for the firm during June 20X1 are listed below, as
The Bike and Hike Outlet is a retail store. Transactions involving purchases and cash payments for the firm during June 20X1 are listed below, as are the general ledger accounts used to record these transactions.
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| 101 | Cash | $ | 18,600 | Dr. |
| 131 | Equipment |
| 57,000 | Dr. |
| 201 | Notes payable |
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| 205 | Accounts payable |
| 4,890 | Cr. |
| 501 | Purchases |
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| 503 | Purchases ret. and allow. |
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| 504 | Purchases discounts |
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| 611 | Rent expense |
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| 614 | Salaries expense |
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| 617 | Telephone expense |
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| DATE |
| TRANSACTIONS | ||
| June | 1 |
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| Issued Check 1101 for $2,500 to pay the monthly rent. |
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| 3 |
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| Purchased merchandise for $2,700 from Perfect Fit Shoe Shop, Invoice 746, dated June 1; the terms are 2/10, n/30. |
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| 5 |
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| Purchased new store equipment for $4,600 from Middleton Company, Invoice 9067 dated June 4, net payable in 30 days. |
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| 7 |
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| Issued Check 1102 for $1,480 to Leisure Wear Clothing Company, a creditor, in payment of Invoice 3342 of May 9. |
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| 8 |
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| Issued Check 1103 for $2,597 to Perfect Fit Shoe Shop, a creditor, in payment of Invoice 746 dated June 1 ($2,650), less a cash discount ($53). |
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| 12 |
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| Purchased merchandise for $2,075 from Juandas Coat Shop, Invoice 9922, dated June 9, net due and payable in 30 days. |
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| 15 |
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| Issued Check 1104 for $229 to pay the monthly telephone bill. |
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| 18 |
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| Received Credit Memorandum 203 for $575 from Juandas Coat Shop for defective goods that were returned; the original purchase was made on Invoice 9922 dated June 9. |
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| 21 |
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| Purchased new store equipment for $9,600 from Warren Company; issued a three-month promissory note with interest at 10 percent. |
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| 23 |
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| Purchased merchandise for $5,500 from The Motor Speedway, Invoice 1927, dated June 20; terms of 2/10, n/30. |
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| 25 |
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| Issued Check 1105 for $1,275 to Juandas Coat Shop, a creditor, as payment on account, Invoice 7416 dated May 28. |
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| 28 |
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| Issued Check 1106 for $5,390 to The Motor Speedway, a creditor, in payment of Invoice 1927 of June 20 ($5,500), less a cash discount ($110). |
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| 30 |
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| Purchased merchandise for $1,990 from Jogging Shoes Store, Invoice 4713, dated June 26; the terms are 1/10, n/30. |
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| 30 |
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| Issued Check 1107 for $4,900 to pay the monthly salaries of the employees. |
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