Term Winter 2018 Complete this packet NEATLY in P ACC1820 MA

Term: Winter 2018 Complete this packet NEATLY in P ACC1820 MANAGERIAL ACCOUNTING Project # 1: Merchandise Accounting Review Part 1: Merchandising Journal Entries 5 Points Assuming the perpetual Inventory system is utilized: prepare the journal entries to record the following transaction for Summer Jewelers. Apr. 2 Summer received an invoice for $25,000 from one of its merchandise suppliers. Terms were 2/10, n/30 FOB shipping point. Ape.3 Summer paid transportation cost on the April 2nd purchase, $1,200. Apr. 4 Summer returned $3,500 of the merchandise billed on April 2nd because it was defective. Apr.5 Summer sold merchandise on account to Charles Simpson Jewelers for $9,000. Terms were 3/15,n/30 FOB destination Summer\'s cost for this merchandise was $5,500. Apr. 8 Summer pald transportation cost on the April 5th sale, $800. Apr. 10 Summer paid the invoice dated April 2nd, less the return and the discount Apr. 15 Charles Simpson Jewelers returned $3,000 of the merchandise from the April 5th sale Apr. 19 Summer received Summer\'s cost for this merchandise was $1,750. scount payment on the remaining amount due from Charles Simpson Jewelers, less the return and the d

Solution

Journal Entries Date Account Title and explanation Debit Credit Apr-02 Merchandise $                  25,000       To Account Payable $                     25,000 (To Record the merchandise Received ) Apr, 03 Transportation Cost $                     1,200        To Cash $                       1,200 (To Recordh the cash paid for the transportation) Apr, 04 Account Payable $                     3,500     To Merchandise $                       3,500 (To Record the return of merchandise) Account Receivable $                     9,000 Apr, 05     To Sales Account $                       9,000 (To Record the sales of Merchandise) Apr, 05 Cost of Goods Sold $                     5,500      To Merchandise $                       5,500 (To Record the cost of Goods sold of merchandise ) Apr-08 Transportation Cost $                        800       To Cash $                           800 (To Record the cost of transportation) Account Payable ( $ 25,000 - $ 3,500) $                  21,500 Apr-10       To Purchase Discount ($ 21,500 X 2%) $                           430      To Cash $                     21,070 (To Record the payment against purchase of Merchandise) Sales Account $                     3,000 Apr-15      To Account Receivable $                       3,000 (To Record the sales Return) Apr-15 Merchandise $                     1,750       To Cost of Goods Sold $                       1,750 (To Record the return of sales against cost of Goods sold) Apr-19 Account Receivable ($ 9,000 - $ 3,000) $                     6,000          To Cash $                       6,000 (To Record the received of payment)