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3 April, 02:15

Journalize the following transactions assuming the perpetual inventory system:July 3 Sold merchandise on account for $3,750 including terms. The cost of the merchandise sold was $2,000. July 5 Issued credit memo for $1,050 for merchandise returned from sale on July 3. The cost of the merchandise returned was $610. July12 Received check for the amount due for sale on July 3 less return on July 5. July 17 Sold merchandise for $7,000 plus 6% sales tax to cash customers. The cost of the merchandise sold was $3,830.

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  1. 3 April, 04:56
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    The journal entries are shown below:

    On July 3

    Account receivable A/c Dr $3,750

    To Sales $3,750

    (Being the goods are sold on credit)

    Cost of goods sold A/c Dr $2,000

    To Merchandise Inventory A/c $2,000

    (Being goods are sold at cost)

    On July 5

    Sales return and allowance A/c Dr $1,050

    To Accounts receivable $1,050

    (Being sales return is recorded)

    Merchandise Inventory A/c $610

    To Cost of goods sold A/c Dr $610

    (Being sales return is recorded)

    On July 12

    Cash A/c Dr $2,700 ($3,050 - $1,050)

    To Accounts receivable $2,700

    (Being cash is received)

    On July 17

    Cash A/c Dr $7,420

    To Sales A/c $7,000

    To Sales tax payable A/c $420 ($7,000 * 6%)

    (Being the goods are sold on credit)

    Cost of goods sold A/c Dr $3,830

    To Merchandise Inventory A/c $3,830

    (Being goods are sold at cost)
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