Question

The following selected transactions were completed by Capers Company during October of the current year: Oct. 1. Purchased merchandise from UK Imports Co., $14,448, terms FOB destination, n/30. 3. Purchased merchandise from Hoagie Co., $9,950, terms FOB shipping point, 2/10, n/eom. Prepaid freight of $220 was added to the invoice. 4. Purchased merchandise from Taco Co., $13,650, terms FOB destination, 2/10, n/30. 6. Issued debit memo to Taco Co. for $4,550 of merchandise returned from purchase on October 4. 13. Paid Hoagie Co. for invoice of October 3, less discount. 14. Paid Taco Co. for invoice of October 4, less debit memo of October 6 and discount. 19. Purchased merchandise from Veggie Co., $27,300, terms FOB shipping point, n/eom. 19. Paid freight of $400 on October 19 purchase from Veggie Co. 20. Purchased merchandise from Caesar Salad Co., $22,000, terms FOB destination, 1/10, n/30. 30. Paid Caesar Salad Co. for invoice of October 20, less discount. 31. Paid UK Imports Co. for invoice of October 1. 31. Paid Veggie Co. for invoice of October 19. Instructions Journalize the entries to record the transactions of Capers Company for October.

Answer 1

Answer:

Capers Company

Journal Entries:

Oct. 1: Debit Inventory $14,448

Credit Accounts Payable (UK Imports Co.) $14,448

To record the purchase of merchandise, terms FOB destination, n/30.

Oct. 3: Debit Inventory $9,950

Credit Accounts Payable (Hoagie Co.) $9,950

To record the purchase of merchandise, terms FOB shipping point, 2/10, n/eom.

Oct. 4: Debit Inventory $13,650

Credit Accounts Payable (Taco Co.) $13,650

To record the purchase of merchandise, terms FOB destination, 2/10, n/30.

Oct. 6: Debit Accounts Payable (Taco Co.) $4,550

Credit Inventory $4,550

To record the return of goods on account.

Oct. 13: Debit Accounts Payable (Hoagie Co.) $9,950

Credit Cash $9,751

Credit Cash Discounts $199

To record the payment on account.

Oct. 14: Debit Accounts Payable (Taco Co.) $9,100

Credit Cash $8,918

Credit Cash Discounts $182

To record the payment on account.

Oct. 19: Debit Inventory $27,300

Credit Accounts Payable (Veggie Co.) $27,300

To record the purchase of merchandise, terms FOB shipping point, n/eom.

Oct. 19: Debit Freight-in $400

Credit Cash $400

To record the payment of freight-in.

Oct. 20: Debit Inventory $22,000

Credit Accounts Payable (Caesar Salad Co.) $22,000

To record the purchase of merchandise, terms 1/10, n/30.

Oct. 30: Debit Accounts Payable (Caesar Salad Co.) $22,000

Credit Cash $21,780  

Credit Cash Discounts $220

To record the payment on account.

Oct. 31: Debit Accounts Payable (UK Imports Co.) $14,448

Credit Cash $14,448

To record the payment on account.

Oct. 31: Debit Accounts Payable (Veggie Co.) $27,300

Credit Cash $27,300

To record the payment on account.

Explanation:

a) Data and Analysis:

Oct. 1: Inventory $14,448 Accounts Payable (UK Imports Co.) $14,448; terms FOB destination, n/30.

Oct. 3: Inventory $9,950 Accounts Payable (Hoagie Co.) $9,950; terms FOB shipping point, 2/10, n/eom.

Oct. 4: Inventory $13,650 Accounts Payable (Taco Co.) $13,650; terms FOB destination, 2/10, n/30.

Oct. 6: Accounts Payable (Taco Co.) $4,550 Inventory $4,550

Oct. 13: Accounts Payable (Hoagie Co.) $9,950 Cash $9,751 Cash Discounts $199

Oct. 14: Accounts Payable (Taco Co.) $9,100 Cash $8,918 Cash Discounts $182

Oct. 19: Inventory $27,300 Accounts Payable (Veggie Co.) $27,300; terms FOB shipping point, n/eom.

Oct. 19: Freight-in $400 Cash $400

Oct. 20: Inventory $22,000 Accounts Payable (Caesar Salad Co.) $22,000; terms  1/10, n/30.

Oct. 30: Accounts Payable (Caesar Salad Co.) $22,000 Cash $21,780  Cash Discounts $220

Oct. 31: Accounts Payable (UK Imports Co.) $14,448 Cash $14,448

Oct. 31: Accounts Payable (Veggie Co.) $27,300 Cash $27,300