Prepare journal entries to record each of the following sales transactions of a

Question

Prepare journal entries to record each of the following sales transactions of a merchandising company. The company uses a perpetual inventory system and the gross method Apr. 1 Sold merchandise for $5,400, with credit terms n/30; invoice dated April 1. The cost of the merchandise is $3,240 Apr 4 The customer in the April 1 sale returned $620 of merchandise for full credit. The merchandise, which had cost $372, is returned to inventory. Apr 8 Sold merchandise for $2,200, with credit terms of 1/10, n/30; invoice dated April 8. Cost of the merchandise is $1,540. Apr. 11 Received payment for the amount due from the April 1 sale less the return on April 4

Explanation / Answer

1-Apr Accounts Receivable 5400         Sales revenue 5400 1-Apr Cost of goods sold 3240       Merchandise inventory 3240 4-Apr Sales return and allowances 620      Accounts Receivable 620 4-Apr Merchandise inventory 372        Cost of goods sold 372 8-Apr Accounts Receivable 2200         Sales revenue 2200 8-Apr Cost of goods sold 1540       Merchandise inventory 1540 11-Apr Cash 4780 =5400-620      Accounts Receivable 4780

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