. Sami’s Skateboards uses the periodic inventory system and had the following sa
ID: 2537949 • Letter: #
Question
. Sami’s Skateboards uses the periodic inventory system and had the following sales transactions during May: (3 MARKS)
May 2 Sold merchandise to Ahmad Shop on credit for SAR 4,800, terms 1/15, n/60. The items sold had a cost of SAR $2,700.
May 4 Ahmad Shop returned merchandise that had a selling price of SAR 200. The cost of the merchandise returned was SAR110.
May 13 Ahmad Shop paid for the merchandise sold on May 2, taking any appropriate discount earned
Prepare the journal entries that Sami’s Skateboards must make to record these transactions
Explanation / Answer
The Journal Entries under Periodic inventory system is as follows:
Note: Under periodic inventory system, the entry forr recording the ccost of goods sold is made only at the end of year.
Date Accounts Title and explanations Debit $ Credit $ 2-May Accounts receivable Dr. 4,800 Sales revenue 4,800 (for goods sold) 4-May Sales return and allowance Dr. 200 Accounts receivable 200 (for goods returned on account) 13-May Cash Account Dr. 4,554 Sales discount Dr. 46 Accounts receivable 4,600 (for discount allowed on cash reciepts)Related Questions
Navigate
Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.