Homework SourseJournalize the following transactions for Cox Company using
Journalize the following transactions for Cox Company using the gross method of accounting for sales discounts. Assume a perpetual inventory system. Also, assume a constant gross profit ratio for all items sold. Make sure to enter the day for each separate transaction. April 7 Sold goods costing $6,000 to Lopez Company on account, $10,000, terms 4/10, n/30. April 13 Lopez Company was granted an allowance of $1,700 for returned merchandise that was previously purchased on account. The returned goods are in perfect condition. April 18 Received the amount due from Lopez Company.
Solution
Journal entry :
| Date | accounts & explanation | debit | credit |
| Apr 7 | Account receivable a/c | 10000 | |
| Sales a/c | 10000 | ||
| Cost of goods sold a/c | 6000 | ||
| Merchandise inventory a/c | 6000 | ||
| (TO record sales) | |||
| Apr 13 | Sales return and allowance a/c | 1700 | |
| Account receivable a/c | 1700 | ||
| Merchandise inventory a/c | 1020 | ||
| Cost of goods sold a/c | 1020 | ||
| (To record sales return) | |||
| Apr 18 | Cash a/c | 8300 | |
| Account receivable a/c | 8300 | ||
| (To record cash received) |
