Journal Entries – Financial Accounting Fundamentals -Week 1

Journal Entries – Financial Accounting Fundamentals – Week 1 Practice Week 1 Quiz

The key terms in this Financial Accounting course include Journal Entries – Financial Accounting Fundamentals – Week 1 Practice Week 1 Quiz

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Prepare journal entries to record the following merchandising transactions of Cabela’s, which uses the perpetual inventory system and the gross method. (Hint: It will help to identify each receivable and payable; for example, record the purchase on July 1 in Accounts Payable—Boden.)
 

July		1		Purchased merchandise from Boden Company for $6,600 under credit terms of 2/15, n/30, FOB shipping point, invoice dated July 1.
		2		Sold merchandise to Creek Co. for $950 under credit terms of 2/10, n/60, FOB shipping point, invoice dated July 2. The merchandise had cost $550.
		3		Paid $120 cash for freight charges on the purchase of July 1.
		8		Sold merchandise that had cost $1,900 for $2,300 cash.
		9		Purchased merchandise from Leight Co. for $2,600 under credit terms of 2/15, n/60, FOB destination, invoice dated July 9.
		11		Received a $600 credit memorandum from Leight Co. for the return of part of the merchandise purchased on July 9.
		12		Received the balance due from Creek Co. for the invoice dated July 2, net of the discount.
		16		Paid the balance due to Boden Company within the discount period.
		19		Sold merchandise that cost $1,200 to Art Co. for $1,800 under credit terms of 2/15, n/60, FOB shipping point, invoice dated July 19.
		21		Issued a $300 credit memorandum to Art Co. for an allowance on goods sold on July 19.
		24		Paid Leight Co. the balance due, net of discount.
		30		Received the balance due from Art Co. for the invoice dated July 19, net of discount.
		31		Sold merchandise that cost $5,400 to Creek Co. for $6,900 under credit terms of 2/10, n/60, FOB shipping point, invoice dated July 31.

Solution

No	Date	General Journal	Debit	Credit
1	July 01	Merchandise inventory	6,600
		Accounts payable—Boden		6,600
2	July 02	Accounts receivable—Creek	950
		Sales		950
3	July 02	Cost of goods sold	550
		Merchandise inventory		550
4	July 03	Merchandise inventory	120
		Cash		120
5	July 08	Cash	2,300
		Sales		2,300
6	July 08	Cost of goods sold	1,900
		Merchandise inventory		1,900
7	July 09	Merchandise inventory	2,600
		Accounts payable—Leight		2,600
8	July 11	Accounts payable—Leight	600
		Merchandise inventory		600
9	July 12	Cashselected answer correct	931
		Sales discountst	19
		Accounts receivable—Creek		950
10	July 16	Accounts payable—Boden	6,600
		Merchandise inventory		132
		Cash		6,468
11	July 19	Accounts receivable—Art	1,800
		Sales		1,800
12	July 19	Cost of goods sold	1,200
		Merchandise inventory		1,200
13	July 21	Sales returns and allowances	300
		Accounts receivable—Art		300
14	July 24	Accounts payable—Leight	2,000
		Merchandise inventory		40
		Cash		1,960
15	July 30	Cash	1,470
		Sales discounts	30
		Accounts receivable—Art		1,500
16	July 31	Accounts receivable—Creek	6,900
		Sales		6,900
17	July 31	Cost of goods sold	5,400
		Merchandise inventory		5,400

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