Alt Part II /6 PowTs June 4 Seller Company sold $20,00 worth of mrchandisc, erms

Question

Alt Part II /6 PowTs June 4 Seller Company sold $20,00 worth of mrchandisc, erms 20,n/30, to Buyer Companry. The cost of the merchandise was $12,000. 6 Buyer pays Roadway Parcel Service $560 for freight charges on the merchandise purchased. 8 Buyer Company returned $500 worth of goods to Seller Company for full credit. The goods had a cost of $300 to Seller Company. 14 Seller Company received appropriate payment from Buyer Company. Seller Company Instructions: Prepare the journal entries to record these transactions for Assume Seller Company uses the perpetual inventory system Skip a line between entries

Explanation / Answer

Jun-04 Accounts receivable 20000 Sales 20000 Cost of goods sold 12000 Merchandise inventory 12000 Jun-06 No entry required in sellers books. Jun-08 Sales returns 500 Accounts receivable 500 Merchandise inventory 300 Cost of goods sold 300 Jun-14 Cash (19500*98%) 19110 Discounts allowed 390 Accounts receivable (20000-500) 19500

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