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Journalize the following inventory merchandise transactions, assuming that the company uses the perpetual inventory system. Refer to the Chart of Accounts for exact wording of account titles.

Dec. 1 Travis Company purchased merchandise on account from a supplier for $5,700, terms 2/10, net 30.
Dec. 6 Travis Company paid for the merchandise within the discount period.

Respuesta :

Answer:

The journal entries are as follows:

(i) On December 1,

Merchandise inventory A/c Dr. $5,700

          To Account payable                   $5,700

(To record the merchandise purchase on account)

(ii) On December 6,

Account payable A/c Dr. $5,700

      To cash                                   $5,586

      To Merchandise inventory    $114

(To record the payment of merchandise within the discount period)

Workings:

Cash = 98% × $5,700

         = $5,586

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