Prepare the journal entries to record the following transactions on Sheridan Com

Question

Prepare the journal entries to record the following transactions on Sheridan Company's books using a perpetual inventory system. (If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts. Credit account titles are automatically indented when amount is entered. Do not indent manually. Record journal entries in the order presented in the problem.) (a) (b) On March 2, Crane Company sold $890,100 of merchandise to Sheridan Company, terms 2/10, n/30. The cost of the merchandise sold was $528,500 On March 6, Sheridan Company returned $100,500 of the merchandise purchased on March 2. The cost of the merchandise returned was $68,700 (c) On March 12, Crane Company received the balance due from Sheridan Company. No. Date Account Titles and Explanation (a) March 2 Accounts Receivable Debit Credit Sales Revenue (b) March 6Sales Returns and Allowances Accounts Receivable (c) March 12Cash Sales Discounts Accounts Receivable

Explanation / Answer

No. Date Account Titles and Explanation Debit Credit (a) Mar-02 Accounts Receivable $8,90,100 Sales Revenue $8,90,100 Being credit sales recorded against receivables (b) Mar-06 Sales Returns and Allowances $1,00,500 Accounts Receivable $1,00,500 Being sales returns recorded against sales (c) Mar-12 Cash $7,73,808 Sales Discounts $15,792 Accounts Receivable $7,89,600 Being cash received net of discount as per invoice terms, against credit sales made on March 2

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