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Question

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<p><span>1. Purchased $3,000 of inventory on account (terms 2%10/net 30</span></p>
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<p>2</p>
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<p>Paid $100 freight bill for #1 with a check</p>
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<p>3</p>
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<p>Paid invoice from transaction #1 above 8 days after invoice date</p>
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<p>4</p>
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<p>Sold 6 bikes to a customer for $200 each, on account. Cost of each bike was $120. Terms were Net 30</p>
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Explanation / Answer

What a messy question! I hardly found your questions there here's my answer: Purchased $3,000 of inventory on account (terms 2%10/net 30 Inventory 3,000 AP 3,000 2 Paid $100 freight bill for #1 with a check Inventory 100 Cash 100 3 Paid invoice from transaction #1 above 8 days after invoice date AP 3,000 Inventory 60 Cash 2,940 4 Sold 6 bikes to a customer for $200 each, on account. Cost of each bike was $120. Terms were Net 30 AR 1,200 Sales revenue 1,200 Cost of goods sold 720 Inventory 720

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