Apr. 2 Purchased $3,600 of merchandise from Lyon Company with credit terms of 2/15 n/60, invoice...


Apr. 2 Purchased $3,600 of merchandise from Lyon Company with credit terms of 2/15 n/60, invoice dated April 2 and FOB shipping point
3 Paid $202 cash for shipping charges on the April 2 purchase
4 Returned to Lyon Company unacceptable merchandise that had an invoice price of $800
17 Sent a check to Lyon Company for the April 2 purchase, net of the discount and the returned merchandise
18 Purchased $7,900 of merchandise from Frist Corp. with credit terms of 1/10, n/30, invoice dated April 18 and FOB destination
21 After negotiations, received from Frist a $500 allowance toward the $7,900 owed on the April 18 purchase
28 Sent check to Frist paying for the April 18 purchase, net of the allowance and the discount


Prepare journal entries to record each of the following merchandising transactions assuming that the buyer uses the periodic inventory system and the gross method.

Journal entry

Every business entity has a lots of transaction going on, and the General journal is a place where every entry is recorded at the first step. Each transaction is recorded for a debit and credit balance thus nullifying the effect in general.

Answer and Explanation: 1

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Date Accounts titledebit credit
Apr 2 Purchase 3600
Account payable-Lyon company 3600
(To record merchandise purchase)
April 3 Freight-in 202

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Learn more about this topic:

What Is Inventory? - Definition & Example


Chapter 13 / Lesson 7

Learn what inventory in business is. Find out three types of inventory management systems and the benefits of each. Understand inventory management through examples.

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