Consider the following transactions for Burlington Drug Store: (Click the icon t
ID: 2337143 • Letter: C
Question
Consider the following transactions for Burlington Drug Store: (Click the icon to view the transactions.) Requirements 2. In the final analysis, how much did the inventory cost Burington Drug Store? Requirement 1. Journaliza the purchase transactions. Explanations are not required. (Assume the company uses a perpetual inventory system. Round the answers to the nearest whole dolar. Record debits first, then credits. Exclude explanations from journal Jounalize the purchase transactions. Explanations are not required. entries.) Feb. 2: Burlington buys $23,800 worth of inventory on account with credit terms of 215, n/30, FOB shipping poin Date Accounts Debit Credit More Info Feb. 2 Feb. 2 Burlington buys S23.800 worth of inventory on account with credit terme of 2 / 15, n / 30. FOB shipping point. 4 Burlington pays a S50 freight charga. 9 Burlington returns $5,200 of the merchandise due to damage during shipment. 14 Burlington paid the amount due, less recurn and discount Print DoneExplanation / Answer
Journal entries for purchase of Merchandise Inventory
Date
General Journal
Debit
Credit
2-Feb
Merchandise Inventory
$ 23,800.00
Accounts Payable
$ 23,800.00
4-Feb
Freight on purchase
$ 50.00
Cash
$ 50.00
9-Feb
Accounts payables
$ 5,200.00
Merchandise Inventory
$ 5,200.00
14-Feb
Accounts payables
$ 18,600.00
cash
$ 18,228.00
Discount Earned
$ 372.00
Notes
Calculation of Discount and net cash payable
Gross purchase value
$ 23,800.00
Less: Goods returned
$ 5,200.00
Gross payable before Discount
$ 18,600.00
Discount 2% on $ 18600
$ 372.00
Net payable in cash
$ 18,228.00
Journal entries for purchase of Merchandise Inventory
Date
General Journal
Debit
Credit
2-Feb
Merchandise Inventory
$ 23,800.00
Accounts Payable
$ 23,800.00
4-Feb
Freight on purchase
$ 50.00
Cash
$ 50.00
9-Feb
Accounts payables
$ 5,200.00
Merchandise Inventory
$ 5,200.00
14-Feb
Accounts payables
$ 18,600.00
cash
$ 18,228.00
Discount Earned
$ 372.00