70.2K

Verified Solution

Link Copied!

GL04-01 - Based on Problem 4-1A LO P1, P2

GL04-01-Based on Problem 4-1A LO P1, P2 Prepare journal entries to record the following merchandising transactions of Taylor's, which uses the perpetual inventory system and the gross method. (Hint: It will help to identify each receivable and payable; for example, record the purchase on July 1 in Accounts Payable-Walker.) Jul. 1 Purchased merchandise from Walker Company for $8,600 under credit terms of 1/15, n/30, FOB shipping point, invoice dated July 1 Jul. 2 Sold merchandise to Perry Co. for $2,200 under credit terms of 2/10, n/60, FOB shipping point, invoice dated July 2. The merchandise had cost $1,320 Jul. 3 Paid $645 cash for freight charges on the purchase of July 1 Jul. 8 Sold merchandise that had cost $2,600 for $4,300 cash. Jul. 9 Purchased merchandise from Ryan Co. for $3,500 under credit terms of 2/15, n/6, FOB destination, invoice dated July 9. Jul. 11 Received a $700 credit memorandum from Ryan Co. for the return of part of the merchandise purchased on July 9 Jul. 12 Received the balance due from Perry Co. for the invoice dated July 2, net of the discount. Jul. 16 Paid the balance due to Walker Company within the discount period. Jul. 19 Sold merchandise that cost $2,700 to Clinton Co. for $3,800 under credit terms of 2/15, n/60, FOB shipping point, invoice dated July 19 Jul. 21 Issued a $800 credit memorandum to Clinton Co. for an allowance on goods sold on July 19. Jul. 24 Paid Ryan Co. the balance due, net of discount Jul. 30 Received the balance due from Clinton Co. for the invoice dated July 19, net of discount Jul. 31 Sold merchandise that cost $5,800 to Perry Co. for $9,600 under credit terms of 2/1, n/6 FOB shipping point, invoice dated July 31

Answer & Explanation Solved by verified expert

See Answer