60.1K

Verified Solution

Link Copied!

su Na Question #1 - 13 marks OD ToneLife Music sells musical instruments. The following data relates to ToneLife's inventory of guitars. On January 1, 2017, ToneLife had 12 guitars in inventory at a cost of $250 each. Provided below are transactions from January. ToneLife has adopted the perpetual inventory system. Required: Provide the journal entries for each of the following transactions. Note: explanations are recommended but are not required. January 2 Purchased 15 guitars at $250 each from International Music Centre (IMC) on account, terms 2/25, n/60 Merchandis Inventory rod $.3750 Accouns Payable V $3750 January 4 Sold 2 guitars for cash at $370 each. O Account Delhivatle, & Hachandise ngentory d tuor $ 740 xsa ales COG January 6 One of the two guitars sold on Jan 4 was returned because it was defective. A full cash refund was paid. The defective guitar was returned to inventory. Merchandiey spentory SOY Chinala January 7 The defective guitar was returned to IMC for a credit on account Merchandise Inventory Accounts Payable and January 16 Sold 21 guitars at $300 on account, terms 2/10, 1/30. Accounts Receivable $200 Merchandis snventory ch x 76 SSL > Coos? January 23 Paid the full amount owing to IMC. Merchandis Inventory Accounts Payabl Susbs IS 18 January 24 Collected the balance owing from the January 16 sale. Merchandise Inventory $6300

Answer & Explanation Solved by verified expert

See Answer