Journalizing the transactions using a perpetual inventory system is as follows:
<h3>Journal Entries:</h3>
May 5 Debit Inventory $5,900
Credit Accounts Payable (Archie Co.) $5,900
- To record the purchase of goods on credit, FOB shipping point, 2/10, n/30.
Debit Freight-in $100
Credit Cash $100
- To record the payment of freight costs of $100 added to the invoice.
May 12 Debit Accounts Payable (Archie Co.) $2,500
Credit Inventory $2,500
- To record the return of goods to supplier.
May 14 Debit Accounts Payable (Archie Co.) $3,400
Credit Cash $3,332
Credit Cash Discounts $68
- To record the cash settlement, including discounts.
<h3>How are transactions recorded using the perpetual inventory system?</h3>
Under the perpetual inventory system, all inventory transactions are recorded as they occur in an inventory account.
This inventory system is unlike the periodic inventory system that records inventory transactions at the end of a period, usually in the purchases account.
<h3>Transaction Analysis:</h3>
May 5 Inventory $5,900 Accounts Payable (Archie Co.) $5,900
FOB shipping point, 2/10, n/30.
Freight-in $100 Cash $100
Prepaid freight costs of $100 were added to the invoice.
May 12 Accounts Payable (Archie Co.) $2,500 Inventory $2,500
May 14 Accounts Payable (Archie Co.) $3,400 Cash $3,332 Cash Discounts $68
Learn more about recording transactions under the perpetual inventory system at brainly.com/question/15326874
#SPJ1
