Exercise J-8 Eaton Company uses the columnar cash journals illustrated in the te
ID: 2392365 • Letter: E
Question
Exercise J-8 Eaton Company uses the columnar cash journals illustrated in the textbook. In April, for the following selected cash transactions occurred Indicate the journal that should be used in recording each transaction. 1. 2. 3. 4. 5. 6. 7. 8. 9. 10. Made a cash refund to a customer for the return of damaged goods. Received collection from customer within the 3% discount period Purchased merchandise for cash. Paid a creditor within the 3% discount period. Received collection from customer after the 3% discount period had expired. Paid freight on merchandise purchased Paid cash for office equipment. Received cash refund from supplier for merchandise returned Paid cash dividend to stockholders. Made cash sales.Explanation / Answer
1. Made a cash refund to a customer for the return of damaged goods.
Debit - Sales Returns and Allowances
Credit - Cash
2. Received collection from customer within the 3% discount period.
Debit - Cash
Debit - Discount
Credit - Accounts Receivable
3. Purchased merchandise for cash.
Debit - Merchandise Inventory or Purchases or Inventory (Based on the name on the drop down menu)
Credit - Cash
4. Paid a creditor within the 3% discount period.
Debit - Accounts Payable
Credit - Cash
Credit - Discount Received
5. Received collection from customer after the 3% discount period had expired.
Debit - Cash
Credit - Accounts Receivable
6. Paid freight on merchandise purchased.
Debit - Freight
Credit - Cash
7. Paid cash for office equipment.
Debit - Office Equipment
Credit - Cash
8. Received cash refund from supplier for merchandise returned.
Debit - Cash
Credit - Inventory / Purchase returns and allowances
9. Paid cash dividend to stockholders.
Debit- Dividend
Credit - Cash
10. Made cash sales.
Debit - Cash
Credit - Sales
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