Mathis Company and Reece Company use the perpetual inventory system. The following transactions...

Question:

Mathis Company and Reece Company use the perpetual inventory system. The following transactions occurred during the month of April:

a. On April 1, Mathis purchased merchandise on account from Reece with credit terms of 2/10, n/30. The selling price of the merchandise was $3,100, and the cost of the merchandise sold was $2,225.

b. On April 1, Mathis paid freight charges of $250 cash to have the goods delivered to its warehouse.

c. On April 8, Mathis returned $800 of the merchandise which had originally cost Reece $500.

d. On April 10, Mathis paid Reece the balance due.

Prepare the journal entries to record these transactions on Reece's books. Assume that Reece uses the net method to record sales on account.

Journal Entries:

Journal entries refer to the summarized format of financial transactions that are recorded in an organization's accounting system. Journal entries provide necessary information for the preparation of financial statements.

Answer and Explanation: 1

Become a Study.com member to unlock this answer!

View this answer

DateParticularsDebitCreditCalculation
Apr. 1Accounts receivable - Mathis Company 3,038 3,100 * 98%
Sales 3,038
Apr. 1Cost of goods sold2,225 ...

See full answer below.


Learn more about this topic:

Loading...
Journal Entries and Trial Balance in Accounting

from

Chapter 3 / Lesson 10
36K

Discover the meaning of a journal entry and a trial balance, types of journal entries, how a general ledger differs from a trial balance, and some examples.


Related to this Question

Explore our homework questions and answers library