Prepare entries to record each of the following transactions of a merchandising

Question

Prepare entries to record each of the following transactions of a merchandising company. The company records purchases using the gross method and a perpetual inventory system. Nov. 5 Purchased 1,350 units of product at a cost of $20 per unit. Terms of the sale are 4/10, ni80: the invoice is dated November 5. Nov. 7 Returned 50 defective units from the November 5 purchase and received full credit. Nov. 15 Paid the amount due from the November 5 purchase, less the return on November 7, Miew transaction lat Journal entry worksheet Purchased 1,350 units of product at a cost of $20 per unit. Terms of the sale are 4/10, n/60; the invoice is dated November 5 Nole: Enter debits before tredts. Date Debit Now 05 V?WW general jurnat Racord enlay

Explanation / Answer

Journal entries Date Accounts title and explanations Debit $ Credit $ 5-Nov Merchandise Inventory Account Dr. 27000    Accounts payable (1350 units @ 20) 27000 7-Nov Accounts payable Accountt dr. (50 units @20) 1000     Merchandise inventory Account 1000 15-Nov Accounts payable account Dr. 26000    Cash account 24960    Merchandise inventory Account (26000*4%) 1040

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