The following transactions occurred between Chao Pharmaceuticals and Hall Drug Store during February of the current year.
Feb. 6 Hall purchased $50,000 of merchandise from Chao on credit terms 1/10, n/30, FOB shipping point. Separately, Hall paid a $2,000 bill for freight in. Chao invoiced Hall for $50,000.
15 Hall returned $7,000 of the merchandise purchased on February 6. Chao issued a credit memo for this amount.
15 Hall paid $24,000 of the invoice amount owed to Chao for the February 6 purchase. This payment included none of the freight charge.
27 Hall paid the remaining amount owed to Chao for the February 6 purchase.
Required
Journalize these transactions, first on the books of Hall Drug Store and second on the books of Chao Pharmaceuticals. Assume both companies use the periodic inventory system and discounts are allowed on partial payments.