A company uses the periodic inventory system and records purchases net of discounts. On April 1, the company purchased merchandise worth P 20,000 under terms 2/10, n/30. The journal entry to be made to record the purchase on April 1 will include a: A. credit to accounts payable of P 20,000 B. debit to purchases of P 20,000 C. credit to accounts payable of P 19,600 D. debit to allowance for purchase discounts of P 400

A company uses the periodic inventory system and records purchases net of discounts. On April 1, the company purchased merchandise worth P 20,000 under terms 2/10, n/30. The journal entry to be made to record the purchase on April 1 will include a: A. credit to accounts payable of P 20,000 B. debit to purchases of P 20,000 C. credit to accounts payable of P 19,600 D. debit to allowance for purchase discounts of P 400

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Presented below are transactions related to Sheridan, Inc. Sheridan uses the periodic inventory method. May 10 Purchased goods billed at $16,700 subject to cash discount terms of 2/10, n/60. 11 Purchased goods billed at $10,600 subject to terms of 1/15, n/30. 19 Paid invoice of May 10. 24 Purchased goods billed at $12,100 subject to cash discount terms of 2/10, n/30. Prepare general journal entries for the transactions above under the assumption that purchases are to be recorded at net amounts after cash discounts and that discounts lost are to be treated as financial expense. (If no entry is required, select "No entry" for the account titles and enter 0 for the amounts. Round answers to 0 decimal places, e.g. 6,578. Credit account titles are automatically indented when amount is entered. Do not indent manually.)
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Prepare journal entries to record the following merchandising transactions of Cabela’s, which uses the perpetual inventory system and the gross method. July 1 Purchased merchandise from Boden Company for $6,900 under credit terms of 2/15, n/30, FOB shipping point, invoice dated July 1. July 2 Sold merchandise to Creek Company for $950 under credit terms of 2/10, n/60, FOB shipping point, invoice dated July 2. The merchandise had cost $575. July 3 Paid $110 cash for freight charges on the purchase of July 1. July 8 Sold merchandise that had cost $2,200 for $2,600 cash. July 9 Purchased merchandise from Leight Company for $2,500 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 Leight Company and debited its account payable for that amount. July 12 Received the balance due from Creek Company for the invoice dated July 2, net of the discount. July 16 Paid the balance due to Boden Company…
Journalize the following merchandise transactions. The company uses the perpetual inventory system. a. Sold merchandise on account, $17,300, with terms 2/10, net 30. The cost of the goods sold was $12,600. If an amount box does not require an entry, leave it blank. b. Received payment within the discount period. If an amount box does not require an entry, leave it blank.
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