Purchased merchandise from Arotek Company for $5,500 under credit terms of 1/10,

Question

Purchased merchandise from Arotek Company for $5,500 under credit terms of 1/10, n/30, FOB destination, invoice dated August 1. 5 Sold merchandise to Laird Corp. for $3,850 under credit terms of 2/10, n/60, FOB destination, invoice dated August 5. The merchandise had cost $2,749. 8 Purchased merchandise from Waters Corporation for $4,800 under credit terms of 1/10, n/45, FOB shipping point, invoice dated August 8. The invoice showed that at Sheng's request. Waters paid the $240 shipping charges and added that amount to the bill. 9 Paid $130 cash for shipping charges related to the August 5 sale to Laird Corp. 10 Laird returned merchandise from the August 5 sale that had cost Sheng $458 and been sold for $642. The merchandise was restored to inventory. 12 After negotiations with Waters Corporation concerning problems with the merchandise purchased on August 8, Sheng received a credit memorandum from Waters granting a price reduction of $725. 14 At Arotek's request. Sheng paid $230 cash for freight charges on the August 1 purchase, reducing the amount owed to Arotek. 15 Received balance due from Laird Corp. for the August 5 sale less the return on August 10. 18 Paid the amount due Waters Corporation for the August 8 purchase less the price reduction granted. 19 Sold merchandise to Tux Co. for $3,300 under credit terms of 1/10, n/30, FOB shipping point, invoice dated August 19. The merchandise had cost $2,290. 22 Tux requested a price reduction on the August 19 sale because the merchandise did not meet specifications. Sheng sent Tux a $550 credit memorandum to resolve the issue. 29 Received Tux's cash payment for the amount due from the August 19 sale. 30 Paid Arotek Company the amount due from the August 1 purchase. Prepare journal entries to record the above merchandising transactions of Sheng Company, which applies the perpetual inventory system.

Explanation / Answer

(A) Date Particulars Dr/Cr Dr Amount Cr Amount Aug-01 Purchase a/c Dr           5,500.00 To Arotek company a/c Cr        5,500.00 Aug-05 Laird Corp A/c Dr           3,850.00 To Sales Cr        3,850.00 Aug-08 Purchase a/c Dr           4,800.00 To Waters corporation a/c Cr        4,800.00 Aug-08 Purchase a/c Dr              240.00 To Waters corporation a/c Cr            240.00 Aug-09 Shipping Charges A/c Dr              130.00 To Cash Cr            130.00 Aug-10 Sales Return A/c Dr              642.00 To Laird Corp A/c Cr            642.00 Aug-12 Water Corporation A/c Dr              725.00 To Purchases Cr            725.00 Aug-14 Arotek Company A/c Dr              230.00 To Cash Cr            230.00 Aug-15 Cash A/c Dr           3,208.00 To Laird Corp A/c Cr        3,208.00 Aug-18 Water Corporation A/c Dr           4,315.00 To Cash Cr        4,315.00 Aug-19 Tux Co A/c Dr           3,300.00 To Sales A/c Cr        3,300.00 Aug-22 Sales A/c Dr              550.00 To Tux Co A/c Cr            550.00 Aug-29 Cash A/c Dr           2,750.00 To Tux Co A/c Cr        2,750.00 Aug-30 Arotek Company A/c Dr           5,270.00 To Cash Cr        5,270.00

Related Questions

Navigate

• Browse (All)
• Browse P
• Subjects

---

---

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.