Following are the merchandising transactions for Dollar Stor

Following are the merchandising transactions for Dollar Store. 1 Dollar Store purchases Perchandise for $1.600 on tens of 2/5, n/3·FOB dipping point, invoice dated November 1, 5 Dollar Store pays cash for the Novenber1 purchase 7 Dollar Store di scovers and retums $200 of defective merchandise purchased on Novenber. and paid for on Novenber 5. for a cash Nov. refund 10 Dollar Store pays $80 cash for tranportation costs for the Novenber 1 purchase. 13 Dollar Store sells nerchandise for $1,728 vith tems n30. The cost of the nerchandise is $864. 16 Merchandise is retumed to the Dollar Store from the Novenber 13 transaction The retued itens are priced at $300 and cost $150: the iteas were not danaged and vere returned to iventory. Journalize the above merchandising transactions for the Dollar Store assuming it uses a perpetual inventory system and the gross method. View transaction list Journal entry worksheet Dollar Store purchases merchandise for $1,600 on terms of 2/5, n/30, FOB shipping point, invoice dated November 1 Note: Enter debits before credits Date General Journal Debit Credit Nov 01 Record entry Clear entry View general journal

Solution

Journal entries: Date Accounts title and explanations Debit $ Credit $ 1-Nov Inventory Account Dr. 1600    Accounts payable 1600 5-Nov Accounts payable Dr. 1600    Cash account (1600*98%) 1568    Inventory Account (1600*2%) 32 7-Nov Cash account Dr. 196     Inventory (200*98%) 196 10-Nov Inventory Account Dr. 80      Cash account 80 13-Nov Accounts receivable Dr. 1728      Sales revenue account 1728 Cost of Goods sold Account Dr. 864      Inventory Account 864 16-Nov Sales return and allowance Account Dr. 300      Accounts receivable 300 Inventory Account Dr. 150      Cost of Goods sold 150