Answer to Question #216327 in Accounting for zuby

Question

Apr. 1 Sold merchandise on account for USD 288,000; terms 2/10, n/30, FOB shipping point, freight collect.

5 USD 43,200 of the goods sold on account on April 1 were returned for a full credit. Payment for these goods had not yet been received.

8 A sales allowance of USD 5,760 was granted on the merchandise sold on April 1 because the merchandise was damaged in shipment.

10 Payment was received for the net amount due from the sale of April 1.

b. High Stereo Company engaged in the following transactions in July 2010.

July 2 Purchased stereo merchandise on account at a cost of USD 43,200; terms 2/10, n/30, FOB destination, freight prepaid.

15 Sold merchandise for USD 64,800, terms 2/10, n/30, FOB destination, freight prepaid.

16 Paid freight costs on the merchandise sold, USD 2,160.

20 High Stereo Company was granted an allowance of USD 2,880 on the purchase of July 2 because of damaged merchandise.

31 Paid the amount due on the purchase of July 2.

Prepare journal entries to record the transactions.

Answer 1

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