using perpetual inventory system

FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Class I am taking is Accounting for Managers.  The book has no examples on how to make these journal entries.  

 

Purchase-related transactions using perpetual inventory system

The following selected transactions were completed by Niles Co. during March of the current year:

Mar. 1. Purchased merchandise from Haas Co., $43,250, terms FOB shipping point, 2/10, n/eom. Prepaid freight of $650 was added to the invoice.
5. Purchased merchandise from Whitman Co., $19,175, terms FOB destination, n/30.
10. Paid Haas Co. for invoice of March 1.
13. Purchased merchandise from Jost Co., $15,550, terms FOB destination, 2/10, n/30.
14. Issued debit memo to Jost Co. for $3,750 of merchandise returned from purchase on March 13.
18. Purchased merchandise from Fairhurst Company, $13,560, terms FOB shipping point, n/eom.
18. Paid freight of $140 on March 18 purchase from Fairhurst Company.
19. Purchased merchandise from Bickle Co., $6,500, terms FOB destination, 2/10, n/30.
23. Paid Jost Co. for invoice of March 13, less debit memo of March 14.
29. Paid Bickle Co. for invoice of March 19.
31. Paid Fairhurst Company for invoice of March 18.
31. Paid Whitman Co. for invoice of March 5.
Expert Solution
Step 1 journal entries.
Date  Accounts titles Debit amount($) Credit amount($)
Mar 1  Merchandise inventory A/c  43,250   
            Accounts payable A/c    43,250 
  ( being merchandise inventory purchased)    
  Merchandise inventory A/c   650   
            Cash A/c   650 
  ( being Prepaid freight was added)    
Mar 5  Merchandise inventory A/c  19,175   
        Accounts payable A/c    19,175 
  ( being merchandise purchased0    
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