Santa Fe Company purchased merchandise for resale from Mesa Company with an invo

Question

Santa Fe Company purchased merchandise for resale from Mesa Company with an invoice price of $19,300 and credit terms of 2/10, n/60. The merchandise had cost Mesa $13,163. Santa Fe paid within the discount period. Assume that both buyer and seller use a perpetual inventory system 1. Prepare the entries that Santa Fe should record for the above transactions. View transaction list Journal entry worksheet 2 Santa Fe Company purchased merchandise for resale from Mesa Company with an invoice price of $19,300 and credit terms of 2/10, n/60. Note: Enter debits before credits. Transaction General Journal Debit Credit Record entry Clear entry View general journal

Explanation / Answer

Journal entry :

No. accounts & explanation debit credit 1 Merchandise inventory 19300     Account payable 19300 (To record purchase) 2 Account payable 19300    Cash (19300*98%) 18914     Merchandise inventory (19300*2%) 386 (To record amount paid)

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