Journalize the following transactions for the buyer, Bell Company, using the gro

Question

Journalize the following transactions for the buyer, Bell Company, using the gross method to account for purchase discounts. Assume a perpetual inventory system. December 1 Purchased merchandise from Ross Company on account, $7,000, terms 4/10, n/30. The goods are December 7 Returned to Ross Company merchandise previously purchased on account, $600. shipped FOB shipping point, freight prepaid by seller, $270 December 12 Paid the amount due to Ross Company Date Account Title Debit Credit Clear Undo Help

Explanation / Answer

Journal

Date Accounts Title and Explanation Debit Credit December 1 Inventory $7000 Accounts Payable $7000 (Merchandise Inventory Purchased) December 7 Accounts Payable $600 Inventory $600 (Inventory returned to supplier) December 12 Accounts Payable $6400 Inventory ($6400*0.04) $256 Cash ($6400-$256) $6144 (Cash paid to supplier availing discount)

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