P5-5B. Journalizing inventory purchases, sales, returns, and freight transactions using the perpetual inventory system; calculating gross profit (Learning Objectives 3, 4, 5, & 6) 25-30 min. The following transactions for Westcoast Tire Co. occurred during July: Jul 4 7 9 11 13 15 16 18 20 22 23 Purchased $5,500 of merchandise on account from Meridian Tire Supply. Terms, 1/15, n/45, FOB shipping point. Meridian Tire Supply prepaid the $475 shipping cost and added the amount to the invoice. Purchased $300 of supplies on account from Office Express. Terms, 3/10, n/30, FOB destination. Sold $5,100 (cost, $2,800) of merchandise on account to P. Larson. Terms, 2/15, n/45, FOB destination. Paid $50 freight charges to deliver goods to P. Larson. Returned $500 of the merchandise purchased on July 4 and received a credit. Sold $900 (cost, $545) of merchandise to cash customers. Paid for the supplies purchased on July 7. Paid Meridian Tire Supply the amount due from the July 4 purchase in full. P. Larson returned $250 (cost, $140) of merchandise from the July 9 sale. Purchased $3,400 of inventory. Paid cash. Received payment in full from P. Larson for the July 9 sale. Requirements 1. Journalize the transactions on the books of Westcoast Tire Co. 2. What was Westcoast Tire Co.'s gross profit for the month of July?
P5-5B. Journalizing inventory purchases, sales, returns, and freight transactions using the perpetual inventory system; calculating gross profit (Learning Objectives 3, 4, 5, & 6) 25-30 min. The following transactions for Westcoast Tire Co. occurred during July: Jul 4 7 9 11 13 15 16 18 20 22 23 Purchased $5,500 of merchandise on account from Meridian Tire Supply. Terms, 1/15, n/45, FOB shipping point. Meridian Tire Supply prepaid the $475 shipping cost and added the amount to the invoice. Purchased $300 of supplies on account from Office Express. Terms, 3/10, n/30, FOB destination. Sold $5,100 (cost, $2,800) of merchandise on account to P. Larson. Terms, 2/15, n/45, FOB destination. Paid $50 freight charges to deliver goods to P. Larson. Returned $500 of the merchandise purchased on July 4 and received a credit. Sold $900 (cost, $545) of merchandise to cash customers. Paid for the supplies purchased on July 7. Paid Meridian Tire Supply the amount due from the July 4 purchase in full. P. Larson returned $250 (cost, $140) of merchandise from the July 9 sale. Purchased $3,400 of inventory. Paid cash. Received payment in full from P. Larson for the July 9 sale. Requirements 1. Journalize the transactions on the books of Westcoast Tire Co. 2. What was Westcoast Tire Co.'s gross profit for the month of July?
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Transcribed Image Text:P5-5B. Journalizing inventory purchases, sales, returns, and freight transactions using the
perpetual inventory system; calculating gross profit (Learning Objectives 3, 4, 5, & 6) 25-30 min.
The following transactions for Westcoast Tire Co. occurred during July:
Jul Purchased $5,500 of merchandise on account from Meridian Tire Supply. Terms, 1/15, n/45,
4 FOB shipping point. Meridian Tire Supply prepaid the $475 shipping cost and added the amount
to the invoice.
7
9
11
13
15
16
18
20
22
23
Purchased $300 of supplies on account from Office Express. Terms, 3/10, n/30, FOB
destination.
Sold $5,100 (cost, $2,800) of merchandise on account to P. Larson. Terms, 2/15, n/45, FOB
destination.
Paid $50 freight charges to deliver goods to P. Larson.
Returned $500 of the merchandise purchased on July 4 and received a credit.
Sold $900 (cost, $545) of merchandise to cash customers.
Paid for the supplies purchased on July 7.
Paid Meridian Tire Supply the amount due from the July 4 purchase in full.
P. Larson returned $250 (cost, $140) of merchandise from the July 9 sale.
Purchased $3,400 of inventory. Paid cash.
Received payment in full from P. Larson for the July 9 sale.
Requirements
1. Journalize the transactions on the books of Westcoast Tire Co.
2. What was Westcoast Tire Co.'s gross profit for the month of July?
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