Compass Inc. purchased 1,000 bags of insulation, on account, from Glassco, Inc. The bags of insulation cost $4.25 each. Compass paid Turner Trucki ,000 bags of insulation shipped to its warehouse. Compass returned 50 bags that were defective and paid for the remainder. Assume that Compass nventory system and that Glassco did not offer a purchase discount. Required:
Compass Inc. purchased 1,000 bags of insulation, on account, from Glassco, Inc. The bags of insulation cost $4.25 each. Compass paid Turner Trucki ,000 bags of insulation shipped to its warehouse. Compass returned 50 bags that were defective and paid for the remainder. Assume that Compass nventory system and that Glassco did not offer a purchase discount. Required:
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Transcribed Image Text:Recording Purchases
Compass Inc. purchased 1,000 bags of insulation, on account, from Glassco, Inc. The bags of insulation cost $4.25 each. Compass paid Turner Trucking $258 to have all
1,000 bags of insulation shipped to its warehouse. Compass returned 50 bags that were defective and paid for the remainder. Assume that Compass uses the perpetual
inventory system and that Glassco did not offer a purchase discount.
Required:
1. Prepare a journal entry to record the purchase of the bags of insulation. If an amount box does not require an entry, leave it blank.
2. Prepare the entry to record the payment for shipping. If an amount box does not require an entry, leave it blank.
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3. Prepare the entry for the return of the defective bags. If an amount box does not require an entry, leave it blank. Round to the nearest cent.
4. Prepare the entry to record the payment for the bags kept by Compass. If an amount box does not require an entry, leave it blank. Round to the nearest cent.
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