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The following selected transactions were completed during August between Summit Company and Beartooth Co. Both companies use the net method under a perpetual inventory system.
The following selected transactions were completed during August between Summit Company and Beartooth Co. Both companies use the net method under a perpetual inventory system.
Aug. | 1 | Summit Company sold merchandise on account to Beartooth Co., $43,500, terms FOB destination, 2/15, n/eom. The cost of the goods sold was $29,330. |
2 | Summit Company paid freight of $1,110 for delivery of merchandise sold to Beartooth Co. on August 1. | |
5 | Summit Company sold merchandise on account to Beartooth Co., $69,400, terms FOB shipping point, n/eom. The cost of the goods sold was $42,440. | |
9 | Beartooth Co. paid freight of $2,310 on August 5 purchase from Summit Company. | |
15 | Summit Company sold merchandise on account to Beartooth Co., $61,000, terms FOB shipping point, n/45. Summit paid freight of $1,555, which was added to the invoice. The cost of the goods sold was $37,780. | |
16 | Beartooth Co. paid Summit Company for purchase of August 1. | |
20 | Summit Company paid Beartooth Co. a cash refund of $1,000 for defective merchandise purchased on August 1. Beartooth Co. kept the merchandise. | |
31 | Beartooth Co. paid Summit Company on account for purchase of August 5. | |
31 | Summit Company issued Beartooth Co. a credit memo for merchandise with an invoice amount of $4,000 that was returned from the August 15 sale. The cost of the merchandise returned was $2,200. |
Journalize the August transactions for (1) Summit Company and (2) Beartooth Co. Refer to the Chart of Accounts of the appropriate company for exact wording of account titles.
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