Safarl File Edit View Hi connect ACCOUNTING nline D.2: Ch 6 Assignment Question

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Safarl File Edit View Hi connect ACCOUNTING nline D.2: Ch 6 Assignment Question 6 (of 14) 5.00 points The following transactions were selected from among those completed by Bear's Retail Store Nov. 20 Sold two items of merchandise to Cheryl Jahn, who paid the $490 sales price in cash. The goods cost Bear's $360 25 Sold 20 items of merchandise to Vasko Athletics at a selling price of $4,600 (total); terms 3/10 n/30. The goods cost Bear's $2,800 28 Sold 10 identical items of merchandise to Nancy's Gym at a selling price of $6,600 (total); terms 3/10, n/30. The goods cost Bear's $4,300 29 Nancy's Gym returned one of the items purchased on the 28th. The item was in perfect condition and credit was given to the customer. Dec. 6 Nancy's Gym paid the account balance in full 30 Vasko Athletics paid in full for the invoice of November 25 Required: Prepare transactions, assuming Bear's Retail Store uses a perpetual inventory "No Journal Entry Required" in the first system. (If no entry is required for a transaction/event, select the nearest whole dollar amount.) View transaction list Journal entry worksheet 6 9 4

Explanation / Answer

Under perpetual inventory system, the sales are recorded at net of discount.

Since Vasko athletics paid after 10 days, the discount amount is reversed to inventory a/c

1 Nov-20 Cash 490 To Sales A/c 490 2 Nov-20 Cost of Goods Sold A/c 360 To Inventory A/c 360 3 Nov-25 Accounts Receivable A/c (4600*97%) 4462 To Sales A/c 4462 4 Nov-25 Cost of Goods Sold A/c 2800 To Inventory A/c 2800 5 Nov-28 Accounts Receivable A/c (6600*97%) 6402 To Sales A/c 6402 6 Nov-28 Cost of Goods Sold A/c 4300 To Inventory A/c 4300 7 Nov-29 Sales Return A/c (6402/10) 640 To Accounts Receivable A/c 640 8 Nov-29 Inventory A/c (4300/10) 430 To Cost of Goods sold A/c 430 9 Dec-06 Cash A/c 5762 To Accounts Receivable A/c 5762 10 Dec-30 Cash A/c 4600 To Accounts Receivable A/c 4462 To Inventory A/c (4600-4462) 138

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