Journalize the following transactions for both Abbott Co. (seller) and Dalton Co
ID: 2478614 • Letter: J
Question
Journalize the following transactions for both Abbott Co. (seller) and Dalton Co. (buyer). Assume both of the companies use the perpetual inventory system.
July 3 Abbott Co. sold merchandise on account to Dalton Co., $7,500, terms FOB shipping point, net/eom. The cost of the merchandise sold was $4,400.
July 5 Dalton Co. paid $275 freight charges on purchase from Abbott Co.
July 9 Abbott Co. issued Dalton Co. a credit memo for merchandise returned, $2,250. The cost of the merchandise returned was $1,325.
July 11 Abbott Co. received payment from Dalton Co. for purchase of July 3.
Explanation / Answer
Journal Entries:
In the books of Abbott Co. (seller) :
In the books of Dalton Co. (buyer) :
date Accounts Titles and explanation Debit $ Credit $ July 3 Accounts Receivables 7500 Sales Revenue 7500 Cost of Merchandise Sold 4400 Merchandise Inventory 4400 July 5 Freight Charges 275 Accounts Receivables 275 July 9 Sales Return 2250 Accounts Receivable 2250 Merchandise Inventory 1325 Cost of Merchandise Sold 1325 July 11 Cash 4975 Accounts Receivables 4975 (7500 - 275 - 2250)Related Questions
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