beginning July, ance in inventory of of July. July 3 Purchase CDs on account from Wholesale Music for $2,000, terms 1/10, n/30. July 4 Pay cash for freight charges related to the July 3 purchase from Wholesale Music, $110. July 9 Return incorrectly ordered CDs to Wholesale Music and receive credit, $300. July 11 Pay Wholesale Music in full. July 12 Sell CDs to customers on account, $5,200, that had a cost of $2,700. following ansactions occur during the month July 15 Receive full payment from customers related to the sale on July 12. July 18 Purchase CDs on account from Music Supply for $2,800, terms 1/10, n/30. July 22 Sell CDs to customers for cash, $3,900, that had a cost of $2,200. July 28 Return CDs to Music Supply and receive credit of $240. July 30 Pay Music Supply in full. Accounting Required: 1. Assuming that CD City uses a perpetual inventory system, record the transactions. 2. Prepare the top section of the multiple-step income statement through gross profit for the month of July.
beginning July, ance in inventory of of July. July 3 Purchase CDs on account from Wholesale Music for $2,000, terms 1/10, n/30. July 4 Pay cash for freight charges related to the July 3 purchase from Wholesale Music, $110. July 9 Return incorrectly ordered CDs to Wholesale Music and receive credit, $300. July 11 Pay Wholesale Music in full. July 12 Sell CDs to customers on account, $5,200, that had a cost of $2,700. following ansactions occur during the month July 15 Receive full payment from customers related to the sale on July 12. July 18 Purchase CDs on account from Music Supply for $2,800, terms 1/10, n/30. July 22 Sell CDs to customers for cash, $3,900, that had a cost of $2,200. July 28 Return CDs to Music Supply and receive credit of $240. July 30 Pay Music Supply in full. Accounting Required: 1. Assuming that CD City uses a perpetual inventory system, record the transactions. 2. Prepare the top section of the multiple-step income statement through gross profit for the month of July.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Question
Ww.208.

Transcribed Image Text:At the beginning of July, CD City has a balance in inventory of $3,100. The following transactions occur during the month
of July.
July 3 Purchase CDs on account from Wholesale Music for $2,000, terms 1/10, n/30.
July 4
Pay cash for freight charges related to the July 3 purchase from Wholesale Music, $110.
July 9
July 11
July 12
Return incorrectly ordered CDs to Wholesale Music and receive credit, $300.
Pay Wholesale Music in full.
Sell CDs to customers on account, $5,200, that had a cost of $2,700.
July 15
Receive full payment from customers related to the sale on July 12.
July 18
Purchase CDs on account from Music Supply for $2,800, terms 1/10, n/30.
July 22 Sell CDs to customers for cash, $3,900, that had a cost of $2,200.
July 28 Return CDs to Music Supply and receive credit of $240.
July 30 Pay Music Supply in full.
Accounting
Required:
1. Assuming that CD City uses a perpetual inventory system, record the transactions.
2. Prepare the top section of the multiple-step income statement through gross profit for the month of July.
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