Brief Exercise 54 Prepare the journal entries to record the

Brief Exercise 5-4 Prepare the journal entries to record the following transactions on McLeena Company\'s books using a perpetual inventory system. (If no entry is required, select \'\"No Entry\" for the account titles and enter O 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) On March 2, Borst Company sold $800,000 of merchandise to McLeena Company, terms 2/10, n/30. The cost of the merchandise sold was $540,000. (b) On March 6, McLeena Company returned $140,000 of the merchandise purchased on March 2. The cost of the merchandise returned was $94,000. (c) On March 12, Borst Company received the balance due from McLeena Company. No. Date Account Titles and Explanation Debit Credit

Solution

Journal Entries in the books of McLeena Company

Date

Accounts Tittles and Explanations

Debit ($)

Credit ($)

a

March 2

Accounts Receivable A/c

800,000

To Sales A/c

800,000

[ To record sale of merchandise inventory ]

b

March 6

Sales returns and allowances A/c

140,000

To Accounts Receivable A/c

140,000

[ To record return of merchandise returned]

c

March 12

Cash A/c [ 660,000 -13,200 ]

646,800

Sales Discounts A/c [ 660,000 x 2% ]

13,200

To Accounts Receivable A/c [ 800,000 – 140,000]

660,000

[To record the payment received from Bernadina Company ]

	Date	Accounts Tittles and Explanations	Debit ($)	Credit ($)
a	March 2	Accounts Receivable A/c	800,000
		To Sales A/c		800,000
		[ To record sale of merchandise inventory ]
b	March 6	Sales returns and allowances A/c	140,000
		To Accounts Receivable A/c		140,000
		[ To record return of merchandise returned]
c	March 12	Cash A/c [ 660,000 -13,200 ]	646,800
		Sales Discounts A/c [ 660,000 x 2% ]	13,200
		To Accounts Receivable A/c [ 800,000 – 140,000]		660,000
		[To record the payment received from Bernadina Company ]