Prepare journal entries to record the following merchandising transactions of Brown'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-Parker) July 1 Purchased merchandise from Parker Company for $6,200 under credit terms of 1/15, n/30, FOB shipping point, invoice dated July 1. July 2 Sold merchandise to Griffin Company for $1,000 under credit terms of 2/10, n/60, FOB shipping point, invoice dated July 2. The merchandise had cost $600. July 3 Paid $165 cash for freight charges on the purchase of July 1. July 8 Sold merchandise that had cost $1,100 for $1,900 cash. July 9 Purchased merchandise from Wilson Company for $2,300 under credit terms of 2/15, n/60, FOB destination, invoice dated July 9. July 11 Returned $500 of merchandise purchased on July 9 from Wilson Company and debited its account payable for that amount. July 12 Received the balance due from Griffin Company for the invoice dated July 2, net of the discount.. July 16 Paid the balance due to Parker Company within the discount period. July 19 Sold merchandise that cost $1,000 to Mannion Company for $1,400 under credit terms of 2/15, n/60, FOB shipping point, invoice dated July 19. July 21 Gave a price reduction (allowance) of $300 to Mannion Company for merchandise sold on July 19 and credited Mannion's accounts receivable for that amount. July 24 Paid Wilson Company the balance due, net of discount. July 30 Received the balance due from Mannion Company for the invoice dated July 19, net of discount. July 31 Sold merchandise that cost $4,300 to Griffin Company for $7,200 under credit terms of 2/10, n/60, FOB shipping point, invoice dated July 31.
Prepare journal entries to record the following merchandising transactions of Brown'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-Parker) July 1 Purchased merchandise from Parker Company for $6,200 under credit terms of 1/15, n/30, FOB shipping point, invoice dated July 1. July 2 Sold merchandise to Griffin Company for $1,000 under credit terms of 2/10, n/60, FOB shipping point, invoice dated July 2. The merchandise had cost $600. July 3 Paid $165 cash for freight charges on the purchase of July 1. July 8 Sold merchandise that had cost $1,100 for $1,900 cash. July 9 Purchased merchandise from Wilson Company for $2,300 under credit terms of 2/15, n/60, FOB destination, invoice dated July 9. July 11 Returned $500 of merchandise purchased on July 9 from Wilson Company and debited its account payable for that amount. July 12 Received the balance due from Griffin Company for the invoice dated July 2, net of the discount.. July 16 Paid the balance due to Parker Company within the discount period. July 19 Sold merchandise that cost $1,000 to Mannion Company for $1,400 under credit terms of 2/15, n/60, FOB shipping point, invoice dated July 19. July 21 Gave a price reduction (allowance) of $300 to Mannion Company for merchandise sold on July 19 and credited Mannion's accounts receivable for that amount. July 24 Paid Wilson Company the balance due, net of discount. July 30 Received the balance due from Mannion Company for the invoice dated July 19, net of discount. July 31 Sold merchandise that cost $4,300 to Griffin Company for $7,200 under credit terms of 2/10, n/60, FOB shipping point, invoice dated July 31.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
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Transcribed Image Text:Prepare journal entries to record the following merchandising transactions of Brown'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-Parker)
July 1 Purchased merchandise from Parker Company for $6,200 under credit terms of 1/15, n/30, FOB shipping point,
invoice dated July 1.
July 2 Sold merchandise to Griffin Company for $1,000 under credit terms of 2/10, n/60, FOB shipping point, invoice
dated July 2. The merchandise had cost $600.
July 3 Paid $165 cash for freight charges on the purchase of July 1.
July 8 Sold merchandise that had cost $1,100 for $1,900 cash.
July 9 Purchased merchandise from Wilson Company for $2,300 under credit terms of 2/15, n/60, FOB destination, invoice
dated July 9.
July 11 Returned $500 of merchandise purchased on July 9 from Wilson Company and debited its account payable for that
amount.
July 12 Received the balance due from Griffin Company for the invoice dated July 2, net of the discount.
July 16 Paid the balance due to Parker Company within the discount period.
July 19 Sold merchandise that cost $1,000 to Mannion Company for $1,400 under credit terms of 2/15, n/60, FOB shipping
point, invoice dated July 19.
July 21 Gave a price reduction (allowance) of $300 to Mannion Company for merchandise sold on July 19 and credited
Mannion's accounts receivable for that amount.
July 24 Paid Wilson Company the balance due, net of discount.
July 30 Received the balance due from Mannion Company for the invoice dated July 19, net of discount.
July 31 Sold merchandise that cost $4,300 to Griffin Company for $7,200 under credit terms of 2/10, n/60, FOB shipping
point, invoice dated July 31.
Transcribed Image Text:Book
Ask
point, invoice dated July 31.
General
Requirement Journali
General
Ledger
Trial Balance
Schedule of
Receivables
Schedule of
Payables
Requirement
Income.
Statement
General Journal tab - Journalize the merchandising transactions. The General Ledger, trial balance and schedules of
accounts receivable and accounts payable will be updated based on your entries.
Impact on
Income
General Ledger tab - One of the advantages of general ledger software is that posting is done automatically. To see the
detail of all transactions that affect a specific account, or the balance in an account at a specific point in time, click on the
General Ledger tab.
Trial Balance tab - General ledger software also automates the preparation of trial balances. A trial balance lists each
account from the General Ledger, along with its balance, either a debit or a credit. Total debits should always equal total
credits.
Schedule of Receivables tab - General Ledger sofware automates the balances for each of the customer's accounts.
Schedule of Payables tab - General Ledger sofware automates the balances for each of the supplier's accounts.
Income Statement tab - Prepare the income statement through the calculation of gross profit.
Impact on Income tab - Indicate the impact each transaction had on net income.
General Journal >
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