Question

Assume that on September 1, Office Depot had an inventory that included a variety of calculators. The company uses a perpetual inventory system. During September, these transactions occurred.
Sept. 6 Purchased calculators from Green Box Co. at a total cost of $1,620, terms n/30.
9 Paid freight of $50 on calculators purchased from Green Box Co.
10 Returned calculators to Green Box Co. for $38 credit because they did not meet specifications.
12 Sold calculators costing $520 for $690 to University Book Store, terms n/30.
14 Granted credit of $45 to University Book Store for the return of one calculator that was not ordered. The calculator cost $34.
20 Sold calculators costing $570 for $760 to Campus Card Shop, terms n/30.

Required:
Journalize the September transactions.

Answer 1

Answer and Explanation:

The journal entries are shown below:

1. Merchandise Inventory $1,620

        To Accounts Payable $1,620

(Being the calculators purchased on account)

2. Merchandise Inventory $50

              To Cash $50

(Being freight expenses paid for cash)

3. Accounts Payable $38

          To Merchandise Inventory $38

(being the returned inventory is recorded)

4. Accounts Receivable $690

          To  Sales Revenues $690

(Being the sales is recorded)

Cost of Goods Sold $520

     To Merchandise Inventory $520

(Being the cost is recorded)

5. Sales returns $45

       To Accounts Receivable $45

(being the sales return is recorded)

Merchandise Inventory $34

    To Cost of Goods Sold $34

(Being the cost of returned is recorded)

6. Accounts Receivable $760

     To Sales Revenues $760

(being the sale is recorded)

Cost of Goods Sold $570

   To Merchandise Inventory $570

(Being the cost is recorded)