Chapter 5, Problem E5A.28E

Journalizing multiple performance obligations and sales transactions

Learning Objective 3, 7 Appendix 5A

Journalize the following sales transactions for Morris Supply. Explanations are not required.
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Mar. 1 Morris Supply sold merchandise inventory for $3,000. The cost of the inventory was $1,800. The customer paid cash. Morris Supply was running a promotion and the customer received a $ 150 award at the time of sale that can be used at a future date on any Morris Supply merchandise.

3 Sold $6,000 of supplies on account. Credit terms are 2/10, n/45, FOB destination. Cost of goods is $3,600.

10 Received payment from the customer on the amount due from March 3, less the discount.

Apr. 15 The customer used the $150 award when purchasing merchandise inventory for $200, the cost of the inventory was $120. The customer paid cash.
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