Santa Fe Retailing purchased merchandise “as is” (with no returns) from Mesa Wholesalers with credit terms of 3/10, n/60 and an invoice price of $21,200. The merchandise had cost Mesa $14,458. Assume that both buyer and seller use a perpetual inventory system and the gross method. 1. Prepare entries that the buyer records for the (a) purchase, (b) cash payment within the discount period, and (c) cash payment after the discount period. 2. Prepare entries that the seller records for the (a) sale, (b) cash collection within the discount period, and (c) cash collection after the discount period.
Santa Fe Retailing purchased merchandise “as is” (with no returns) from Mesa Wholesalers with credit terms of 3/10, n/60 and an invoice price of $21,200. The merchandise had cost Mesa $14,458. Assume that both buyer and seller use a perpetual inventory system and the gross method. 1. Prepare entries that the buyer records for the (a) purchase, (b) cash payment within the discount period, and (c) cash payment after the discount period. 2. Prepare entries that the seller records for the (a) sale, (b) cash collection within the discount period, and (c) cash collection after the discount period.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Exercise 5-6 Recording sales, purchases, and cash discounts-buyer and seller LO P1, P2
Santa Fe Retailing purchased merchandise “as is” (with no returns) from Mesa Wholesalers with credit terms of 3/10, n/60 and an invoice price of $21,200. The merchandise had cost Mesa $14,458. Assume that both buyer and seller use a perpetual inventory system and the gross method.
1. Prepare entries that the buyer records for the (a) purchase, (b) cash payment within the discount period, and (c) cash payment after the discount period.
2. Prepare entries that the seller records for the (a) sale, (b) cash collection within the discount period, and (c) cash collection after the discount period.
Transcribed Image Text:Complete this question by entering your answers in the tabs below.
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Prepare entries that the buyer records for the (a) purchase, (b) cash payment within the discount period, and (c) cash payment after the
discount period.
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Journal entry worksheet
1
Record Santa Fe Retailing purchased merchandise "as is" (with no returns)
from Mesa Wholesalers with credit terms of 3/10, n/60 and an invoice price of
$21,200.
2 3
Note: Enter debits before credits.
Transaction
a
Record entry
General Journal
Clear entry
Debit
Credit
View general journal
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