The following is a series of related transactions between Siogo Shoes, a shoe wh

Question

The following is a series of related transactions between Siogo Shoes, a shoe wholesaler, and Sole Mates, a chain of retail shoe stores: Feb.9 Siogo Shoes sold Sole Mates 100 pairs of hiking boots on account, terms 1/10, n/30. The cost of these boots to Siogo Shoes was $60 per pair, and the sales price was $100 per pair. Feb.12 United Express charged $80 for delivering this merchandise to Sole Mates. These charges were split evenly between the buyer and seller and were paid immediately in cash. Feb.13 Sole Mates returned 10 pairs of boots to Siogo Shoes because they were the wrong size. Siogo Shoes allowed Sole Mates full credit for this return. Feb.19 Sole Mates paid the remaining balance due to Siogo Shoes within the discount period. Both companies use a perpetual inventory system. Instructions a. Record this series of transactions in the general journal of Siogo Shoes. (The company records sales at gross sales price.) (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.) b. Record this series of transactions in the general journal of Sole Mates. (The company records purchases of merchandise at net cost and uses a Transportation-in account to record transportation charges on inbound shipments.) (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.)

Explanation / Answer

a. Record this series of transactions in the general journal of Siogo Shoes. (The company records sales at gross sales price.) (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.)

b. Record this series of transactions in the general journal of Sole Mates. (The company records purchases of merchandise at net cost and uses a Transportation-in account to record transportation charges on inbound shipments.) (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.)

(A) Date Particular Debit in $ Credit in $ 9-Feb Accounts Receivable (Sole Mates) 10000 Sales 10000 (Sold merchandise on account) 9 Cost of Goods Sold 6000 Inventory 6000 (To record cost of merchandise sold) 12 Delivery Expense 80 Cash 80 (Paid delivery charges on outbound shipment.) 13 Sales 1000 Accounts Receivable (Sole Mates) 1000 (Customer returned merchandise) 13 Inventory 600 Cost of Goods Sold 600 (Reduce cost of goods sold for cost
of merchandise returned) 19 Cash 8910 Sales Discount 90 Accounts Receivable (Sole Mates) 9000 Collected amount due.

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