(a) On March 2, Carla Vista Co. sold $945,800 of merchandise to Wildhorse Co., t

Question

(a) On March 2, Carla Vista Co. sold $945,800 of merchandise to Wildhorse Co., terms 3/10, n/30. The cost of the merchandise sold was $531,700 (b) On March 6, wildhorse Co. returned $102,500 of the merchandise purchased on March 2. The cost of the merchandise returned was $68,300 (c) On March 12, Carla Vista Co. received the balance due from Wildhorse Co.. No. Date Account Titles and Explanation Debit Credit (a) March nventory 945800 945800 (To record sale of merchandise) March 6 (To record return of merchandise) (c) March 12

Explanation / Answer

SOLUTION

S.No. Date Accounts title and Explanation Debit ($) Credit ($) A. March 2 Accounts Receivable 945,800 Sales Revenue 945,800 (To record sale of merchandise) Cost of goods sold   531,700 Inventory 531,700 B. March 6 Sales Returns & Allowances 102,500   Accounts Receivable 102,500 (To record return of merchandise) Inventory 68,300 Cost of goods sold 68,300 C. March 12 Cash 818,001 Sales Discount ($843,300 * 3%) 25,299 Accounts Receivable ($945,800 - $102,500) 843,300

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