Critical Thinking Problem 8.1 Journalizing Merchandising Transactions William Ev

Question

Critical Thinking Problem 8.1 Journalizing Merchandising Transactions William Evans began Evans and engaged in the transactions below. Assume Evans Distributors and its customers take ad Distribators, a sporting goods distribution company, in January 2019 of all cash discounts. DATE 2019 Jan.1 William Evans started Evans Distributors with an investment of $54,000. He also invested personal business equipment worth $6.000. 2 Purchased merchandise for cash, $10,500, Check 100. Sold merchandise on account to Chu Corporation. 5750,terms 2/10, ni 30 Invoice 1001 urchased merchandise on account from Tsang Company,$1,900, terms 1/10 n/30, Invoice 1125. chan- 5 Received and paid freight charges related to January 4 purchase of mer dise from Tsang Company, $120, Check 101 10 Chu Corporation returned merchandise purchased on January 2: issued credit memo #101 for $100. Received payment in full from Chu Corporation. Paid amount due to Tsang Company for purchase of January 4, Check 102 11 13 15 Recorded cash sales for the two-week period ended January 15 of $6,250. 15 Recorded sales on credit cards for the two-week period ended January 15, $1-200the bank charges a 3% fee on all credit card sales. Paid wages, $1,575, Check 103. Purchased equipment (not for resale) $1,750, Check 104. 15 16 17 Paid freight for delivery of equipment purchased on January 16,$350, Check 105. (Note: Freight charges for purchase of equipment should be debited to the Equipment account.) 18 Purchased merchandise on account from Terri Manufacturing for $4,500, sub- ject to a trade discount of 40%, terms 1/ 10, n30. Invoice 2078. Sold merchandise on account to Moloney Corp., $2,500, terms 1/10, n/30, Invoice 1002 Purchased merchandise on account from Schmidt Company, $3,000, terms 1/10, n/30, Invoice 3204; freight prepaid by Schmidt Company and added to invoice, $70.(Total invoice amount, $3,070) Paid amount owed to Terri Manufacturing for purchase of January 18, Check 106. Received amount due from Moloney Corp. for the sale of January 20. Paid amount due to Schmidt Company for purchase of January 21, Check 107. 20 21 27 29 30 31 Recorded cash sales for the period from January 16-31, $6,825 31 Recorded sales on the credit cards for the period from January 16-31, $2.200; the bank charges a 3% fee on all credit card sales. INSTRUCTIONS Record the transactions in a general journal. Number the first journal as page 1. Provide brief expla nations after each journal entry

Explanation / Answer

EVANS DISTRIBUTORS General journal for the month of January 31,2019 Date Account Title Debit Credit Jan.1 Cash 54000 Equipment 6000 Williams Evans, Capital 60000 (Investment made by William Evans) Jan.2 Inventory 10500 Cash 10500 (Purchase of inventory , check. 100) Jan.3 Accounts Receivable 750 Sales 750 (Sales on account to Chu Corp. Inv.1001) Jan.4 Inventory 1900 Accounts Payable 1900 (Purchase of inventory on account ) Jan.5 Freight -in 120 Cash 120 (Freight charges paid on inventory purchase - Check 101) Jan.10 Sales 100 Accounts Receivable 100 (Credit issued to Chu Corp. For returned goods) Jan.11 Cash 650 Accounts Receivable 650 (Payment received from Chu Corp.) Jan.13 Accounts Payable 1900 Cash 1900 (Payment made for purchase dated Jan.4 - check 102) Jan.15 Cash 6250 Sales 6250 (Cash sales recorded for the first two weeks) Jan.15 Cash 1164 Bank Charges 36 Sales 1200 (Credit card sales for the first two weeks) Jan.15 Wages Expense 1575 Cash 1575 (Wages paid for the first two weeks - Check 103) Jan.16 Equipment 1750 Cash 1750 (Purchase of equipment - Check 104) Jan.17 Equipment 350 Cash 350 (Freight paid for equipment - check 105) Jan.18 Inventory 4500 Discount on purchases 1800 Accounts Payable 2700 (Purchase of merchandise from Terri Mfg.) Jan.20 Accounts Receivable 2500 Sales 2500 (Sales on account to Moloney Corp. Inv.1002) Jan.21 Inventory 3000 Freight -in 70 Accounts Payable 3070 (Purchase of inventory from Schmidt Company) Jan.27 Accounts Payable 2700 Cash 2700 (Payment made to Terri Mfg. - check 106) Jan.29 Cash 2500 Accounts Receivable 2500 (Payment received from Moloney Corp.) Jan.30 Accounts Payable 3070 Cash 3070 (Payment made to Schmidt Co. - Check 107) Jan.31 Cash 6825 Sales 6825 (Cash sales for the period from 16-31) Jan.31 Cash 2134 Bank Charges 66 Sales 2200 (Credit card sales for the second two weeks)

Related Questions

Navigate

• Browse (All)
• Browse C
• Subjects

---

---

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