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The following transactions were recorded by an inexperienced bookkeeper during the months of June and July for Sheridan Company. Sheridan Company uses a perpetual inventory

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The following transactions were recorded by an inexperienced bookkeeper during the months of June and July for Sheridan Company. Sheridan Company uses a perpetual inventory system. June 10 A purchase of $3,600 of merchandise from DanDan Distributors was debited to Purchases and credited to Cash. The terms of the purchase were 2/10,n/30, FOB shipping point. 11 The invoice for freight in the amount of $175 for the delivery of merchandise purchased from DanDan was paid and was debited to Delivery Expense. 12 Damaged goods totalling $500 were returned to DanDan Distributors for credit. The bookkeeper recorded a debit to Accounts Receivable and a credit to Sales Returns and Allowances. 20 A payment was made to DanDan Distributors for the June 10 purchase. The payment was a debit to Purchases and a credit to Cash. July 15 Sheridan sold goods for \$9,405: Sales was credited and Cost of Goods Sold was debited for this amount. The cost of the inventory sold was $3,100. The terms of the sale were 1/15,n/30, FOB destination. 15 Freight charges on the above transaction were debited to Accounts Receivable and credited to Cash for $165. The bookkeeper believed the customer had to pay for the freightcharges. 17 Sheridan's manager gave the customer from July 15 a $360 allowance. The entry made to record the allowance was a debit to Sales and a credit to Sales Returns and Allowances. Review each transaction below and indicate whether you agree or disagree with how the bookkeeper accounted for the transaction. June 10 A purchase of $3,600 of merchandise from DanDan Distributors was debited to Purchases and credited to Cash. The terms of the purchase were 2/10,n/30, FOB shipping point. 11. The invoice for freight in the amount of $175 for the delivery of merchandise purchased from DanDan was paid and was debited to Delivery Expense. 12. Damaged goods totalling $500 were returned to DanDan Distributors for credit. The bookkeeper recorded a debit to Accounts Receivable and a credit to Sales Returns and Allowances. 20 A payment was made to DanDan Distributors for the June 10 purchase. The payment was a debit to Purchases and a credit to Cash. July 15 Sheridan sold goods for \$9.405: Sales was credited and Cost of coods Sold was debited for this amount. The cost of the inventory sold was $3.100. The terms of the sale were 1/15,n/30, FOB destination 15 Freight charges on the above transaction were debited to Accounts Receivable and credited to Cash for $165. The bookkeeper believed the customer had to pay for the freight charges. 17 Sheridan's manager gave the customer from July 15 a $360 allowance. The entry made to record the allowance was a debit to Sales and a credit to Sales Returns and Allowances

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