ACTBAS2 Notes

Periodic Inventory System

Perpetual Inventory System

Purchases xxx Accounts Payable
Purchase of merchandise on account

Merchandise Inventory
Accounts Payable
Purchase of merchandise on account

xxx

Accounts Payable
Merchandise Inventory
Return of merchandise

xxx

Accounts Receivable
Cost of Sales
Sales
Merchandise Inventory
Sale of merchandise on account

xxx xx Sales Returns and Allowances
Merchandise Inventory
Accounts Receivable
Cost of Sales
Return of merchandise

xxx xx xxx

xxx

Merchandise Inventory
Cash
Freight on purchases
Freight-Out
Cash
Freight on sales

xxx

xxx

xxx

xxx

Loss due to Inventory Shortage
Merchandise Inventory
Inventory Shortage (correcting entry)

Accounts Payable

xxx

xxx

Purchase Returns and Allowances xxx

Return of merchandise
Accounts Receivable xxx Sales
Sale of merchandise on account

Sales Returns and Allowances
Accounts Receivable
Return of merchandise

xxx

Freight-In
Cash
Freight on purchases

xxx

Freight-Out
Cash
Freight on sales

xxx

xxx

xxx

Merchandise Inventory, End xxx Income Summary
Inventory Count (adjusting entry)
Buyer Freight Terms

xxx

xxx

xxx xx xxx xx xxx

xxx

xxx

Seller Freight Terms

Freight-Out
Cash
FOB Destination - Prepaid

xxx

Freight-Out
Accounts Receivable
FOB Destination - Collect

xxx

Accounts Receivable
Cash
FOB Shipping Point - Prepaid

xxx

xxx

Accounts Payable
Cash
FOB Destination - Collect

xxx

xxx

Freight-In
Accounts Payable
FOB Shipping Point - Prepaid

xxx

xxx

Freight-In
Cash
FOB Shipping Point - Collect

xxx

xxx

xxx

xxx

Value-Added Tax on Purchases

Value-Added Tax on Sales

Purchases
Input Tax
Accounts Payable
Purchase of merchandise

xxx xxx Accounts Payable

xxx

xxx

Purchase Returns and Allowances xxx

Input Tax
Return of purchase
Accounts Payable xxx Cash
Purchase Discount
Input Tax
Payment with discount taken

xxx

xxx xxx xxx

Accounts Receivable
Sales
Output Tax
Sale of merchandise

xxx xxx xxx

Sales Returns and Allowances
Output Tax
Accounts Receivable