The following are the daily business transaction of Shehgarlynn Mini Mart:
January 1, 2013 bought $5,500 of merchandise on account, terms 3/10, 1/15, n/30, from Yosores Company,
Journal Entry
Merchandise Purchases $5,500.00
Accounts Payable $5,500.00
January 5, 2013 Sales on credit to Gary Co. amounted to $2,500, terms 2/10, n/30.
Journal Entry
Accounts Receivable $2,500.00
Sales $2,500.00
January 10, 2013 Gary Co. return of $550.00 on goods sold on Jan. 5.
Journal Entry
Sales Returns and Allowances $550.00
Accounts Receivable $550.00
January 14, 2013 Received a cash from Gary Co. in payment of the goods sold on Jan. 5.
Journal Entry
Cash $1,911.00
Sales Discount 39.00
Accounts Receivable 1,950.00
Computation:
Cost of Goods Sold $2,500.00
Less: Sales Return and Allowances 550.00
Total Sales ..................................$1,950.00
Discount Rate............................... 2%
Sales Discount 39.00
Sales $1,950.00
Less: Sales Discount 39.00
Cash received $1,911.00
January 15, 2013 Sent a check # 025, amounting to Yosores Co. in payment of purchase made on January 1,
Journal Entry
Accounts Payable $5,500.00
Purchases Discount 55.00
Cash $5,445.00
Computation:
Merchandise Purchases $5,500.00
Discount Rate 1%
Purchases Discount 55.00
Merchandise Purchases $5,500.00
Less:Purchases Discount 55.00
Net Purchases 5,445.00
January 18, 2013 Purchased merchandise on credit to Shehlynn Co. for $7,500, terms 3/10, n/30.
Journal Entry
Merchandise Purchases $7,500.00
Accounts Payable $7,500.00
January 20, 2013 Sales for the day amounted to $15,325.00
Journal Entry
Cash $15,325.00
Sales $15,325.00
January 25, 2013 Some items purchased from Shehlyn Co. are returned amounted $1,750 in goods purchased on January 18.
Journal Entry
Accounts Payable $1,750.00
Purchases Returns & Allowances $1,750.00
January 29, 2013 Paid for freight charges on purchase of Jan. 1. amounting $150.
Journal Entry
Freight on Purchases $150.00
Cash $150.00
January 31, 2013 Paid to Shehlynn Co., the total amount in payment of purchase made on January 18.
Journal Entry
Accounts Payable $5,750.00
Cash $5,750.00
Computation
Merchandise Purchase $7,500.00
Less: Purchases Returns & Allowances 1,750.00
Net Purchases $5,750.00