July 1 Purchased merchandise from Boden Company for $6,600 under credit terms of

Question

July 1 Purchased merchandise from Boden Company for $6,600 under credit terms of 2/15, n/30, FOB shipping point, invoice dated July 1. 2 Sold merchandise to Creek Co. for $950 under credit terms of 2/10, n/60, FOB shipping point, invoice dated July 2. The merchandise had cost $550. 3 Paid $120 cash for freight charges on the purchase of July 1. 8 Sold merchandise that had cost $1,900 for $2,300 cash. 9 Purchased merchandise from Leight Co. for $2,500 under credit terms of 2/15, n/60, FOB destination, invoice dated July 9. 11 Received a $500 credit memorandum from Leight Co. for the return of part of the merchandise purchased on July 9. 12 Received the balance due from Creek Co. for the invoice dated July 2, net of the discount. 16 Paid the balance due to Boden Company within the discount period. 19 Sold merchandise that cost $1,000 to Art Co. for $1,500 under credit terms of 2/15, n/60, FOB shipping point, invoice dated July 19. 21 Issued a $250 credit memorandum to Art Co. for an allowance on goods sold on July 19. 24 Paid Leight Co. the balance due after deducting the discount. 30 Received the balance due from Art Co. for the invoice dated July 19, net of discount. 31 Sold merchandise that cost $5,400 to Creek Co. for $7,000 under credit terms of 2/10, n/60, FOB shipping point, invoice dated July 31.

Explanation / Answer

July 1 Merchandise Inventory-Boden 6600 Accounts payable 6600 JUly 2 Accounts receivable 950 sales revenue 950 cost of goods sold 550 merchandise inventory 550 July 3 merchandise inventory 120 cash 120 July 8 cash 2300 sales revenue 2300 cost of goods sold 1900 merchandise inventory 1900 July 9 merchandise inventory-leight co 2500 Accounts payable 2500 July 11 Accounts payable -leight co. 500 merchandise inventory 500 July 12 cash 931 sales Discount [950*.02] 19 sales revenue -creek co. 950 July 16 Accounts payable 6600 merchandise inventory [6600*.02] 132 cash 6468 july 19 Accounts receivable -art co 1500 sales revenue 1500 cost of goods sold 1000 merchandise inventory 1000 July 21 Sales return and allowance 250 Accounts receivable -art co 250 JUly 24 Accounts payable   [2500-500] 2000 merchandise inventory [2000*.02] 40 cash 1960 jULY 30 cash 1225 sales discount [1250*.02] 25 Accounts receivable -art co [1500-250] 1250 July 31 Accounts receivable-creek co 7000 sales revenue 7000 cost of goods sold 5400 merchandise inventory 5400

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