The transaction for May 14th is "Reed Corp. received payment in full from Brady Co. for its May 2 purchase. Payment was not made in time to take the discount" The transaction for May 2nd is "Brady Co. purchased $1,750 of merchandise on account from Reed Corp. The merchandise was sold on credit terms 3/10, n/30 and shipping terms of FOB shipping point. The cost of the merchandise to the seller was $1,274." Am I incorrect to say that the transaction for May 14th should be $1,750? It says that it's incorrect. As you can see, I've tried somewhat random numbers. Nothing else is mention about that transaction except on May 3 when "Freight costs of $130 were paid by Brady Co. in cash for the merchandise purchased the previous day."

Analyze each transaction (described by rolling over the date) from the perspective of each party. In the first journal space, record each transaction as it affects Reed Corp., on the appropriate day. Then record the same transaction in the bottom journal space as it affects Brady Co If no entry is required, select "No entry required" and leave the amount boxes blank. If compound entries, for those boxes in which no entry is required, leave the box blank. Date Reed Corp. Debit Credit May 2 Accounts Receivable-Brady Co. 1,750 Sales 1,750 Cost of Goods Sold 1,274 Merchandise Inventory 1,274V May 3 No entry required 0 No entry required May 7 Merchandise Inventory 800 800 Accounts Payable-Brady Co. May 8 No entry required 0 Analyze each transaction (described by rolling over the date) from the perspective of each party. In the first journal space, record each transaction as it affects Reed Corp., on the appropriate day. Then record the same transaction in the bottom journal space as it affects Brady Co If no entry is required, select "No entry required" and leave the amount boxes blank. If compound entries, for those boxes in which no entry is required, leave the box blank. Date Reed Corp. Debit Credit May 2 Accounts Receivable-Brady Co. 1,750 Sales 1,750 Cost of Goods Sold 1,274 Merchandise Inventory 1,274V May 3 No entry required 0 No entry required May 7 Merchandise Inventory 800 800 Accounts Payable-Brady Co. May 8 No entry required 0