Question

Presented here are selected transactions for the Cullumber Company during April. Cullumber uses the perpetual inventory system. April 1 Sold merchandise to Mann Company for $4,200, terms 2/10, n/30. The merchandise sold had a cost of $3,000. 2 Purchased merchandise from Wild Corporation for $8,500, terms 1/10, n/30. 4 Purchased merchandise from Ryan Company for $1,100, n/30. 10 Received payment from Mann Company for purchase of April 1 less appropriate discount. 11 Paid Wild Corporation for April 2 purchase. Journalize the April transactions for Cullumber Company

Answer 1

Answer:

Cullumber Company

Journal Entries:

April 1 Debit Accounts receivable (Mann Company) $4,200

Credit Sales revenue $4,200

To record the sale of goods on credit terms, 2/10, n/30.

Debit Cost of goods sold $3,000

Credit Inventory $3,000

To record the cost of goods sold.

April 2 Debit Inventory $8,500

Credit Accounts payable (Wild Corporation) $8,500

To record the purchase of goods on credit terms, 1/10, n/30.

April 4 Debit Inventory $1,100

Credit Accounts payable (Ryan Company) $1,100

To record the purchase of goods on credit terms, n/30.

April 10 Debit Cash $4,116

Debit Cash Discounts $84

Credit Accounts receivable (Mann Company) $4,200

To record the receipt of cash on account, including discounts.

April 11 Debit Accounts payable (Wild Corporation) $8,500

Credit Cash $8,415

Credit Cash Discounts $85

To record the payment on account, including discounts.

Explanation:

a) Data and Analysis:

April 1 Accounts receivable (Mann Company) $4,200 Sales revenue $4,200 terms 2/10, n/30.

Cost of goods sold $3,000 Inventory $3,000

April 2 Inventory $8,500 Accounts payable (Wild Corporation) $8,500 terms 1/10, n/30.

April 4 Inventory $1,100 Accounts payable (Ryan Company) $1,100 n/30.

April 10 Cash $4,116 Cash Discounts $84 Accounts receivable (Mann Company) $4,200

April 11 Accounts payable (Wild Corporation) $8,500 Cash $8,415 Cash Discounts $85