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The following transactions were recorded by an inexperienced bookkeeper during the months of June and July for Blossom Company. Blossom Company uses a perpetual inventory
The following transactions were recorded by an inexperienced bookkeeper during the months of June and July for Blossom Company. Blossom Company uses a perpetual inventory system. June 10 A purchase of $3,700 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 $215 for the delivery of merchandise purchased from DanDan was paid and was debited to Delivery Expense. 12 Damaged goods totalling $400 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 Blossom sold goods for $9,205; Sales was credited and Cost of Goods Sold was debited for this amount. The cost of the inventory sold was $3,300. 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 \$135. The bookkeeper believed the customer had to pay for the freight charges. Blossom's manager gave the customer from July 15 a \$200 allowance. The entry made to record the allowance was a debit to Sales and a credit to Sales Returns and Allowances. If you disagreed with any of the accounting entries above, prepare the correct entries. (Credit account titles are automatically indented when the amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter O for the amounts. Record journal entries in the order presented in the problem. List all debit entries before credit entries.) June 20 (To record sales on account.) (To record cost of goods sold.) (To record cash payment for freight costs.)
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