Problem 4-1A (40 minutes)
Aug. 1 Merchandise Inventory 6,000 Accounts Payable—Abilene 6,000 Purchased goods on credit.
4 Accounts Payable—Abilene 100 Cash 100 Paid freight for Abilene.
5 Accounts Receivable—Lux 4,200 Sales 4,200 Sold goods on credit.
5 Cost of Goods Sold 3,000 Merchandise Inventory 3,000 To record the cost of August 5 sale.
8 Merchandise Inventory 5,540 Accounts Payable—Welch 5,540 Purchased goods on credit.
9 Delivery Expense 120 Cash 120 Paid shipping charges on August 5 sale.
10 Sales Returns and Allowances 700 Accounts Receivable—Lux 700 …show more content…
10 Merchandise Inventory 500 Cost of Goods Sold 500 Returned goods to inventory.
12 Accounts Payable—Welch 800 Merchandise Inventory 800 Received a credit memorandum for August 8 purchase.
Problem 4-1A (Concluded)
Aug. 15 Cash 3,430 Sales Discounts 70 Accounts Receivable—Lux 3,500 Collected receivable within 2% discount period.
18 Accounts Payable—Welch 4,740 Merchandise Inventory* 45 Cash** 4,695 Paid payable within discount period * (1% x [$5,300 - $800]) **([100%-1%] x [$5,300 - $800]) + $240 shipping.
19 Accounts Receivable—Trax 3,600 Sales 3,600 Sold goods on credit.
19 Cost of Goods Sold 2,500 Merchandise Inventory 2,500 To record cost of the August 19 sale.
22 Sales Returns and Allowances 600 Accounts Receivable—Trax 600 Issued credit memorandum.
29 Cash 2,970 Sales Discounts (1%) 30 Accounts Receivable—Trax 3,000 Collected receivable within discount period.
30 Accounts Payable—Abilene 5,900 Cash