Chapter 4, Problem 6E

(a)

To determine

Introduction: Journalizing is the first step in accounting. All the routine transactions of a company are recorded in the journal. Each transaction is recorded separately into the journal. Under the perpetual inventory system, the accounting records are updated after every purchase or sale of inventory, unlike the periodic system where the records are updated at the end of the month. Under the net method, the transactions are recorded at discounted amounts.
To prepare: The journal entries that buyer records under perpetual inventory system at gross amount.

(b)

To determine

Introduction: Journalizing is the first step in accounting. All the routine transactions of a company are recorded in the journal. Each transaction is recorded separately into the journal. Under the perpetual inventory system, the accounting records are updated after every purchase or sale of inventory, unlike the periodic system where the records are updated at the end of the month. Under the net method, the transactions are recorded at discounted amounts.

To prepare: The journal entries that seller records under perpetual inventory system at gross amount.