Exercise 1: 1. In May 7 Ali Co. purchase goods FOB shipping point from Ahmed Co. for $5000 on account under credit terms 2/10, n/30, 2. in May 7, Ali Co. paid cash $150 as freight expenses FOB shipping point 3. May 12 Ali Co. returns goods purchased in May 7 to Ahmed Co. for $300 4. in May 15, Ali Co. paid the balance due within the discount period Instructions: Prepare Journal entries assuming periodic inventory system. Purchase transactions: 1- Purchases Date May 7 Handout 5: Accounting for merchandising operations Date May 7 General Journal Account Title & Explanation 2- Freight expenses Example: in May 7, Ali Co. paid cash $150 as freight expenses FOB shipping point General Journal Account Title & Explanation Date May 12 3- Purchase Return and allowances Ref. Debit General Journal Account Title & Explanation Ref. Debit Credit Ref. Debit Credit Credit
Exercise 1: 1. In May 7 Ali Co. purchase goods FOB shipping point from Ahmed Co. for $5000 on account under credit terms 2/10, n/30, 2. in May 7, Ali Co. paid cash $150 as freight expenses FOB shipping point 3. May 12 Ali Co. returns goods purchased in May 7 to Ahmed Co. for $300 4. in May 15, Ali Co. paid the balance due within the discount period Instructions: Prepare Journal entries assuming periodic inventory system. Purchase transactions: 1- Purchases Date May 7 Handout 5: Accounting for merchandising operations Date May 7 General Journal Account Title & Explanation 2- Freight expenses Example: in May 7, Ali Co. paid cash $150 as freight expenses FOB shipping point General Journal Account Title & Explanation Date May 12 3- Purchase Return and allowances Ref. Debit General Journal Account Title & Explanation Ref. Debit Credit Ref. Debit Credit Credit
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
Related questions
Question
Transcribed Image Text:Exercise 1:
1.
In May 7 Ali Co. purchase goods FOB shipping point from Ahmed Co. for
$5000 on account under credit terms 2/10, n/30,
2. in May 7, Ali Co. paid cash $150 as freight expenses FOB shipping point
3. May 12 Ali Co. returns goods purchased in May 7 to Ahmed Co. for $300
4. in May 15, Ali Co. paid the balance due within the discount period
Instructions: Prepare Journal entries assuming periodic inventory system.
Purchase transactions:
1- Purchases
Date
May 7
Handout 5: Accounting for merchandising operations
Date
May 7
General Journal
Account Title & Explanation
2- Freight expenses
Example: in May 7, Ali Co. paid cash $150 as freight expenses FOB shipping point
General Journal
Account Title & Explanation
Date
May 12
3- Purchase Return and allowances
Ref. Debit
General Journal
Account Title & Explanation
Ref. Debit
Credit
Ref. Debit
Credit
Credit
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