Liabelity Management

Topics: Accounts receivable, Generally Accepted Accounting Principles, Inventory Pages: 3 (340 words) Published: February 23, 2013
Travel Warehouse distributes suitcases to retail stores and extends credit term of 1/10, n/30. Travel’s inventory consists of 40 suitcases purchased at $30 each. During The month of July the following merchandising transactions occurred. July 1,Purchased 50 suitcases $30 each on account from Suitcases Manufacturer. FOB Destination, terms 1/15, n/30. The appropriate party paid $100 for the freight.

3Sold 40 suitcases on account to Luggage world for $50 each.
9Paid Suitcases Manufacturer in full.
12Received payment in full from luggage World.
17Sold 30 suitcases on account to Travel Spot for $50 each.
18Purchased 60 suitcases for $1700 on account from Vacation Manufacturer. FOB Shipping point. terms 1/15, n/30. The appropriate party paid $100 for the freight. 20Received $300 credit (including freight) for 10 suitcases returned to Vacation Manufacturers.

21 Received payment in full from Travel Spot.
22Sold 40 suitcases on account to Vacation-Are-Us for $50 each.
30 Paid Vacation Manufacturer in full.
31Granted $250 credit for 5 suitcases returned costing 150.

Journalize the transactions for the month of July using a perpetual inventory system.

Travel Warehouse
Merchandise Inventory 1500
Accounts Payable 1500
Accounts Receivable 2000
Sales 2000
Cost of Goods Sold 1200
Merchandise Inventory 1200

Accounts Payable 1500
Purchase Discount 15
Cash 1485

Cash 1980
Sales Discount 20
Accounts Receivable 2000
Accounts Receivable 1500
Sales 1500
Cost of Goods Sold 900
Merchandise Inventory 900
Merchandise Inventory 1800
Accounts Payable 1800
Accounts Payable 300
Merchandise Inventory 300

Cash 1485
Sales Discount 15
Accounts Receivable 1500
Continue Reading

Please join StudyMode to read the full document

You May Also Find These Documents Helpful

  • An Analysis of Working Capital Management Results Across Industries Essay
  • Engineering Management Essay
  • Essay about Walmart Management
  • Principals of Management Essay
  • Essay about Travel Agency Management
  • Working Capital Management Essay
  • Operations management Essay
  • The Big Three of Cash Management Essay

Become a StudyMode Member

Sign Up - It's Free