The following were selected from among the transactions completed by Babcock Com

Question

The following were selected from among the transactions completed by Babcock Company during November of the current year:
Nov. 3 Purchased merchandise on account from Moonlight Co., list price $93,000, trade discount 25%, terms
FOB destination, 2/10, n/30.
4 Sold merchandise for cash, $34,100. The cost of the goods sold was $22,080.
5 Purchased merchandise on account from Papoose Creek Co., $43,650, terms FOB shipping point,
2/10, n/30, with prepaid freight of $750 added to the invoice.
6 Returned $15,000 ($20,000 list price less trade discount of 25%) of merchandise purchased on
November 3 from Moonlight Co.
8 Sold merchandise on account to Quinn Co., $15,270 with terms n/15. The cost of the goods sold was
$8,940.
13 Paid Moonlight Co. on account for purchase of November 3, less return of November 6.
14 Sold merchandise on VISA, $229,890. The cost of the goods sold was $153,500.
15 Paid Papoose Creek Co. on account for purchase of November 5.
23 Received cash on account from sale of November 8 to Quinn Co.
24 Sold merchandise on account to Rabel Co., $51,300, terms 1/10, n/30. The cost of the goods sold was
$33,280.
28 Paid VISA service fee of $3,410.
30 Paid Quinn Co. a cash refund of $5,610 for returned merchandise from sale of November 8. The cost of
the returned merchandise was $3,180.
Journalize the transactions. Refer to the Chart of Accounts for exact wording of account titles.

Chart of Accounts CHART OF ACCOUNTS Babcock Company General Ledger REVENUE 410 Sales 610 Interest Revenue ASSETS 110 Cash 121 Accounts Receivable-Quinn Co 122 Accounts Receivable-Rabel Co 125 Notes Receivable 130 Inventory 131 Estimated Returns Inventory 140 Office Supplies 141 Store Supplies 142 Prepaid Insurance 180 Land 192 Store Equipment 193 Accumulated Depreciation-Store Equipment 194 Office Equipment 195 Accumulated Depreciation-Office Equipment EXPENSES 510 Cost of Goods Sold 521 Delivery Expense 522 Advertising Expense 524 Depreciation Expense-Store Equipment 525 Depreciation Expense- Office Equipment 526 Salaries Expense 531 Rent Expense 533 Insurance Expense 534 Store Supplies Expense 535 Office Supplies Expense 536 Credit Card Expense 539 Miscellaneous Expense 710 Interest Expense LIABILITIES 211 Accounts Payable-Moonlight Co. 212 Accounts Payable-Papoose Creek Co. 216 Salaries Payable 218 Sales Tax Payable 219 Customer Refunds Payable 221 Notes Payable EQUITY 310 Common Stock 311 Retained Earnings 312 Dividends 313 Income Summary

Explanation / Answer

Journal entries for the month of November is shown as follows:- (Amounts in $)

Journal Accounting Equation Date Description Post Ref. Debit Credit Assets Liabilities Equity Nov. 3 Inventory ($93,000*0.75) 69,750 +69,750 Accounts Payable-Moonlight Co. 69,750 +69,750 Nov. 4 Cash 34,100 +34,100 Sales 34,100 +34,100 Cost of goods sold 22,080 -22,080 Inventory 22,080 -22,080 Nov. 5 Inventory (43,650+750) 44,400 +44,400 Accounts Payable-Papoose Creek Co. 44,400 +44,400 Nov. 6 Accounts Payable-Moonlight Co. 15,000 -15,000 Inventory 15,000 -15,000 Nov. 8 Accounts Receivable-Quinn Co. 15,270 +15,270 Sales 15,270 +15,270 Cost of goods sold 8,940 -8,940 Inventory 8,940 -8,940 Nov. 13 Accounts Payable-Moonlight Co. (69,750-15,000) 54,750 -54,750 Cash (Bal fig) 53,655 -53,655 Inventory (54,750*2%) 1,095 -1,095 Nov. 14 Cash 229,890 +229,890 Sales 229,890 +229,890 Cost of goods sold 153,500 -153,500 Inventory 153,500 -153,500 Nov.15 Accounts Payable-Pappose Creek Co. 44,400 -44,400 Cash (Bal fig) 43,512 -43,512 Inventory (44,400*2%) 888 -888 Nov. 23 Cash 15,270 +15,270 Accounts Receivable-Quinn Co. 15,270 -15,270 Nov. 24 Accounts Receivable-Rabel Co. 51,300 +51,300 Sales 51,300 +51,300 Cost of goods sold 33,280 -33,280 Inventory 33,280 -33,280 Nov. 28 Credit Card Expense 3,410 -3,410 Cash 3,410 -3,410 Nov. 30 Estimated Returns Inventory 5,610 -5,610 Cash 5,610 -5,610 Inventory 3,180 +3,180 Cost of goods sold 3,180 +3,180

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