Prepare journal entries to record each of the following transactions of a merchandising company....
Question:
Prepare journal entries to record each of the following transactions of a merchandising company. The company uses a perpetual inventory system and the gross method.
| Nov. 5 | Purchased 850 units of a product at a cost of $10 per unit. Terms of the sale are 3/10, n/60; the invoice is dated November 5 |
| Nov. 7 | Returned 30 defective units from the November 5 purchase and received full credit |
| Nov. 15 | Paid the amount due from the November 5 purchase, less the return on November 7 |
Discount:
Providing discounts is considered a marketing tool in order for customers to patronize the products offered. Such discounts can be in the form of cash discounts, trade discounts, and the like.
Answer and Explanation: 1
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View this answerUsing a perpetual inventory system and the gross method, the above transactions must be recorded in the book of merchandising company as follows.
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