Journal Entries for Merchandise Transactions—Perpetual System Cushing Distributing Company uses the perpetual inventory system. Cushing had the following transactions related to merchandise during the month of June: June 1 Purchased on account merchandise for resale for $9,000; terms were 2/10, n/30. 3 Paid $450 cash for freight on the June 1 purchase. 7 Returned merchandise costing $600 (part of the $9,000 purchase). 10 Paid for merchandise purchased on June 1. 13 Sold merchandise on account costing $8,000 for $11,000; terms were 2/10, n/30. 16 Customer returned merchandise costing $750 that had been sold on account for $1,000 (part of the $11,000 sale). 22 Received payment from customer for merchandise sold on June 13. Required Prepare journal entries for each of the transactions for the Cushing Distributing Company. GENERAL JOURNAL Date Description Debit Credit June 1 AnswerAccounts PayableAccounts ReceivableCashCost of Goods SoldInventorySales RevenueSales Returns and AllowancesSales Discounts Answer Answer AnswerAccounts PayableAccounts ReceivableCashCost of Goods SoldInventorySales RevenueSales Returns and AllowancesSales Discounts Answer Answer Purchased merchandise with 2/10, n/30 terms. 3 AnswerAccounts PayableAccounts ReceivableCashCost of Goods SoldInventorySales RevenueSales Returns and AllowancesSales Discounts Answer Answer AnswerAccounts PayableAccounts ReceivableCashCost of Goods SoldInventorySales RevenueSales Returns and AllowancesSales Discounts Answer Answer Paid freight on June 1 purchase. 7 AnswerAccounts PayableAccounts ReceivableCashCost of Goods SoldInventorySales RevenueSales Returns and AllowancesSales Discounts Answer Answer AnswerAccounts PayableAccounts ReceivableCashCost of Goods SoldInventorySales RevenueSales Returns and AllowancesSales Discounts Answer Answer Returned merchandise from June 1 purchase. 10 AnswerAccounts PayableAccounts ReceivableCashCost of Goods SoldInventorySales RevenueSales Returns and AllowancesSales Discounts Answer Answer AnswerAccounts PayableAccounts ReceivableCashCost of Goods SoldInventorySales RevenueSales Returns and AllowancesSales Discounts Answer Answer Cash Answer Answer Paid for merchandise purchased on June 1 within the discount period. 13 AnswerAccounts PayableAccounts ReceivableCashCost of Goods SoldInventorySales RevenueSales Returns and AllowancesSales Discounts Answer Answer AnswerAccounts PayableAccounts ReceivableCashCost of Goods SoldInventorySales RevenueSales Returns and AllowancesSales Discounts Answer Answer To record revenue from sale of merchandise. 13 AnswerAccounts PayableAccounts ReceivableCashCost of Goods SoldInventorySales RevenueSales Returns and AllowancesSales Discounts Answer Answer AnswerAccounts PayableAccounts ReceivableCashCost of Goods SoldInventorySales RevenueSales Returns and AllowancesSales Discounts Answer Answer To record cost of merchandise sold and to reduce inventory. 16 AnswerAccounts PayableAccounts ReceivableCashCost of Goods SoldInventorySales RevenueSales Returns and AllowancesSales Discounts Answer Answer AnswerAccounts PayableAccounts ReceivableCashCost of Goods SoldInventorySales RevenueSales Returns and AllowancesSales Discounts Answer Answer To record sales return by customer. 16 AnswerAccounts PayableAccounts ReceivableCashCost of Goods SoldInventorySales RevenueSales Returns and AllowancesSales Discounts Answer Answer AnswerAccounts PayableAccounts ReceivableCashCost of Goods SoldInventorySales RevenueSales Returns and AllowancesSales Discounts Answer Answer To record cost of goods returned by customers. 22 Cash Answer Answer AnswerAccounts PayableAccounts ReceivableCashCost of Goods SoldInventorySales RevenueSales Returns and AllowancesSales Discounts Answer Answer AnswerAccounts PayableAccounts ReceivableCashCost of Goods SoldInventorySales RevenueSales Returns and AllowancesSales Discounts Answer Answer To record receipt of cash from customer within the discount period.

Journal Entries for Merchandise Transactions—Perpetual System Cushing Distributing Company uses the perpetual inventory system. Cushing had the following transactions related to merchandise during the month of June: June 1 Purchased on account merchandise for resale for $9,000; terms were 2/10, n/30. 3 Paid $450 cash for freight on the June 1 purchase. 7 Returned merchandise costing $600 (part of the $9,000 purchase). 10 Paid for merchandise purchased on June 1. 13 Sold merchandise on account costing $8,000 for $11,000; terms were 2/10, n/30. 16 Customer returned merchandise costing $750 that had been sold on account for $1,000 (part of the $11,000 sale). 22 Received payment from customer for merchandise sold on June 13. Required Prepare journal entries for each of the transactions for the Cushing Distributing Company. GENERAL JOURNAL Date Description Debit Credit June 1 AnswerAccounts PayableAccounts ReceivableCashCost of Goods SoldInventorySales RevenueSales Returns and AllowancesSales Discounts Answer Answer AnswerAccounts PayableAccounts ReceivableCashCost of Goods SoldInventorySales RevenueSales Returns and AllowancesSales Discounts Answer Answer Purchased merchandise with 2/10, n/30 terms. 3 AnswerAccounts PayableAccounts ReceivableCashCost of Goods SoldInventorySales RevenueSales Returns and AllowancesSales Discounts Answer Answer AnswerAccounts PayableAccounts ReceivableCashCost of Goods SoldInventorySales RevenueSales Returns and AllowancesSales Discounts Answer Answer Paid freight on June 1 purchase. 7 AnswerAccounts PayableAccounts ReceivableCashCost of Goods SoldInventorySales RevenueSales Returns and AllowancesSales Discounts Answer Answer AnswerAccounts PayableAccounts ReceivableCashCost of Goods SoldInventorySales RevenueSales Returns and AllowancesSales Discounts Answer Answer Returned merchandise from June 1 purchase. 10 AnswerAccounts PayableAccounts ReceivableCashCost of Goods SoldInventorySales RevenueSales Returns and AllowancesSales Discounts Answer Answer AnswerAccounts PayableAccounts ReceivableCashCost of Goods SoldInventorySales RevenueSales Returns and AllowancesSales Discounts Answer Answer Cash Answer Answer Paid for merchandise purchased on June 1 within the discount period. 13 AnswerAccounts PayableAccounts ReceivableCashCost of Goods SoldInventorySales RevenueSales Returns and AllowancesSales Discounts Answer Answer AnswerAccounts PayableAccounts ReceivableCashCost of Goods SoldInventorySales RevenueSales Returns and AllowancesSales Discounts Answer Answer To record revenue from sale of merchandise. 13 AnswerAccounts PayableAccounts ReceivableCashCost of Goods SoldInventorySales RevenueSales Returns and AllowancesSales Discounts Answer Answer AnswerAccounts PayableAccounts ReceivableCashCost of Goods SoldInventorySales RevenueSales Returns and AllowancesSales Discounts Answer Answer To record cost of merchandise sold and to reduce inventory. 16 AnswerAccounts PayableAccounts ReceivableCashCost of Goods SoldInventorySales RevenueSales Returns and AllowancesSales Discounts Answer Answer AnswerAccounts PayableAccounts ReceivableCashCost of Goods SoldInventorySales RevenueSales Returns and AllowancesSales Discounts Answer Answer To record sales return by customer. 16 AnswerAccounts PayableAccounts ReceivableCashCost of Goods SoldInventorySales RevenueSales Returns and AllowancesSales Discounts Answer Answer AnswerAccounts PayableAccounts ReceivableCashCost of Goods SoldInventorySales RevenueSales Returns and AllowancesSales Discounts Answer Answer To record cost of goods returned by customers. 22 Cash Answer Answer AnswerAccounts PayableAccounts ReceivableCashCost of Goods SoldInventorySales RevenueSales Returns and AllowancesSales Discounts Answer Answer AnswerAccounts PayableAccounts ReceivableCashCost of Goods SoldInventorySales RevenueSales Returns and AllowancesSales Discounts Answer Answer To record receipt of cash from customer within the discount period.

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

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Question

Journal Entries for Merchandise Transactions—Perpetual System

Cushing Distributing Company uses the perpetual inventory system. Cushing had the following transactions related to merchandise during the month of June:

June	1	Purchased on account merchandise for resale for $9,000; terms were 2/10, n/30.
	3	Paid $450 cash for freight on the June 1 purchase.
	7	Returned merchandise costing $600 (part of the $9,000 purchase).
	10	Paid for merchandise purchased on June 1.
	13	Sold merchandise on account costing $8,000 for $11,000; terms were 2/10, n/30.
	16	Customer returned merchandise costing $750 that had been sold on account for $1,000 (part of the $11,000 sale).
	22	Received payment from customer for merchandise sold on June 13.

Required

Prepare journal entries for each of the transactions for the Cushing Distributing Company.

GENERAL JOURNAL
Date	Description	Debit	Credit
June	1	AnswerAccounts PayableAccounts ReceivableCashCost of Goods SoldInventorySales RevenueSales Returns and AllowancesSales Discounts	Answer	Answer
		AnswerAccounts PayableAccounts ReceivableCashCost of Goods SoldInventorySales RevenueSales Returns and AllowancesSales Discounts	Answer	Answer
		Purchased merchandise with 2/10, n/30 terms.
	3	AnswerAccounts PayableAccounts ReceivableCashCost of Goods SoldInventorySales RevenueSales Returns and AllowancesSales Discounts	Answer	Answer
		AnswerAccounts PayableAccounts ReceivableCashCost of Goods SoldInventorySales RevenueSales Returns and AllowancesSales Discounts	Answer	Answer
		Paid freight on June 1 purchase.
	7	AnswerAccounts PayableAccounts ReceivableCashCost of Goods SoldInventorySales RevenueSales Returns and AllowancesSales Discounts	Answer	Answer
		AnswerAccounts PayableAccounts ReceivableCashCost of Goods SoldInventorySales RevenueSales Returns and AllowancesSales Discounts	Answer	Answer
		Returned merchandise from June 1 purchase.
	10	AnswerAccounts PayableAccounts ReceivableCashCost of Goods SoldInventorySales RevenueSales Returns and AllowancesSales Discounts	Answer	Answer
		AnswerAccounts PayableAccounts ReceivableCashCost of Goods SoldInventorySales RevenueSales Returns and AllowancesSales Discounts	Answer	Answer
		Cash	Answer	Answer
		Paid for merchandise purchased on June 1 within the discount period.
	13	AnswerAccounts PayableAccounts ReceivableCashCost of Goods SoldInventorySales RevenueSales Returns and AllowancesSales Discounts	Answer	Answer
		AnswerAccounts PayableAccounts ReceivableCashCost of Goods SoldInventorySales RevenueSales Returns and AllowancesSales Discounts	Answer	Answer
		To record revenue from sale of merchandise.
	13	AnswerAccounts PayableAccounts ReceivableCashCost of Goods SoldInventorySales RevenueSales Returns and AllowancesSales Discounts	Answer	Answer
		AnswerAccounts PayableAccounts ReceivableCashCost of Goods SoldInventorySales RevenueSales Returns and AllowancesSales Discounts	Answer	Answer
		To record cost of merchandise sold and to reduce inventory.
	16	AnswerAccounts PayableAccounts ReceivableCashCost of Goods SoldInventorySales RevenueSales Returns and AllowancesSales Discounts	Answer	Answer
		AnswerAccounts PayableAccounts ReceivableCashCost of Goods SoldInventorySales RevenueSales Returns and AllowancesSales Discounts	Answer	Answer
		To record sales return by customer.
	16	AnswerAccounts PayableAccounts ReceivableCashCost of Goods SoldInventorySales RevenueSales Returns and AllowancesSales Discounts	Answer	Answer
		AnswerAccounts PayableAccounts ReceivableCashCost of Goods SoldInventorySales RevenueSales Returns and AllowancesSales Discounts	Answer	Answer
		To record cost of goods returned by customers.
	22	Cash	Answer	Answer
		AnswerAccounts PayableAccounts ReceivableCashCost of Goods SoldInventorySales RevenueSales Returns and AllowancesSales Discounts	Answer	Answer
		AnswerAccounts PayableAccounts ReceivableCashCost of Goods SoldInventorySales RevenueSales Returns and AllowancesSales Discounts	Answer	Answer
		To record receipt of cash from customer within the discount period.

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