Shankar Company uses a perpetual system to record inventory

Shankar Company uses a perpetual system to record inventory transactions. The company purchases 1,000 units of inventory on account on February 2 for $30,000 ($30 per unit) but then returns 50 defective units on February 5.

Record the inventory purchase on February 2 and the inventory return on February 5. (If no entry is required for a particular transaction/event, select \"No journal entry required\" in the first account field.)

Solution

Date General Journal Debit Credit February 2 Purchases $30,000 Accounts payable $30,000 February 5 Accounts payable $1,500 Purchase returns $1,500