On June 5, Staley Electronics purchases 180 units of inventory on account for $1

Question

On June 5, Staley Electronics purchases 180 units of inventory on account for $18 each. After closer examination, Staley determines 20 units are defective and returns them to its supplier for full credit on June 9. All remaining inventory is sold on account on June 16 for $31 each. Required: Record transactions for the purchase, return, and sale of inventory assuming the company uses a perpetual inventory system. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.)

Record the purchase of inventory on account.

Record the return of inventory purchased.

Record the sale of inventory on account.

Record the cost on invenotry sold.

Explanation / Answer

Journal entry :

Date accounts & explanation debit credit June 5 Merchandise inventory (180*18) 3240 Account payable 3240 (To record purchase of inventory) June 9 Account payable (20*18) 360 Merchandise inventory 360 (To record return of inventory) June 16 Account receivable (160*31) 4960 Sales revenue 4960 (To record Sales) June 16 Cost of goods sold (160*18) 2880 Merchandise inventory 2880 (To record cost of goods sold)

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