A.. Record the purchase of vehicles from a manufacturer on account for $608,000.
ID: 2412384 • Letter: A
Question
A.. Record the purchase of vehicles from a manufacturer on account for $608,000.
B. Record the return of vehicles by the manufacturer at $152,000.
C. Record the sale of vehicles at $685,000.
D. Record the cost of vehicles sold at $380,000.
E. Record the return of vehicles by the customer at $137,000.
F. Record the cost of vehicles returned at $76,000.
During its first year of operations, Tron Auto Dealership (TAD) bought vehicles from a manufacturer on account at a cost of $608,000. TAD returned $152,000 of these vehicles to the manufacturer for credit on its account. TAD then sold $380,000 of the remaining vehicles at a selling price of $685,000. TAD's customers rarely return vehicles, so TAD records sales returns only as they occur. One customer did return a vehicle to TAD, which had been sold to the customer for $137,000. The vehicle was in perfect condition, so it was put back into TAD's inventory at TAD's cost of $76,000. Prepare journal entries to record these transactions, assuming TAD uses a perpetual inventory system. (If no entry is required for a transaction/event, select "No Journal Entry Required" in the first account field.) View transaction list Journal entry worksheet Record the purchase of vehicles from a manufacturer on account for $608,000. Note: Enter debits before credits. Transaction General Journal Debit CreditExplanation / Answer
Answer
Journal Entry no
Accounts title
Debit
Credit
A
Inventory
$ 6,08,000.00
Accounts Payable
$ 6,08,000.00
(inventory purchased)
B
Accounts Payable
$ 1,52,000.00
Inventory
$ 1,52,000.00
(inventory returned)
C
Accounts receivables
$ 6,85,000.00
Sales revenue
$ 6,85,000.00
(sales made on account)
D
Cost of Goods Sold
$ 3,80,000.00
Inventory
$ 3,80,000.00
(inventory adjusted by cost of goods sold)
E
Sales return
$ 1,37,000.00
Accounts receivables
$ 1,37,000.00
(returned by customer)
F
Inventory
$ 76,000.00
Cost of Goods Sold
$ 76,000.00
(cost of inventory returned back)
Journal Entry no
Accounts title
Debit
Credit
A
Inventory
$ 6,08,000.00
Accounts Payable
$ 6,08,000.00
(inventory purchased)
B
Accounts Payable
$ 1,52,000.00
Inventory
$ 1,52,000.00
(inventory returned)
C
Accounts receivables
$ 6,85,000.00
Sales revenue
$ 6,85,000.00
(sales made on account)
D
Cost of Goods Sold
$ 3,80,000.00
Inventory
$ 3,80,000.00
(inventory adjusted by cost of goods sold)
E
Sales return
$ 1,37,000.00
Accounts receivables
$ 1,37,000.00
(returned by customer)
F
Inventory
$ 76,000.00
Cost of Goods Sold
$ 76,000.00
(cost of inventory returned back)
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