Answer and Explanation:
The journal entries are shown below:
1. Merchandise inventory $26,400
To Account payable $26,400
(Being purchase is recorded)
2. Merchandise inventory $590
To Cash $590
(Being freight paid)
3. Equipment $33,900
To Account payable $33,900
(Being purchase of an equipment is recorded)
4. Account payable $5,200
To Merchandise inventory $5,200
(Being purchase return is recorded)
5. Account payable $21,200 ($26,400 - $5,200)
To Cash $20,352
To Merchandise inventory ($21,200 × 0.04%) $848
(Being the amount paid is recorded)
