Journalize entries for the following related transactions of Manville Heating & Air Company. Refer to the Chart of Accounts for exact wording of account titles.

Mar. 1 Purchased $90,000 of merchandise from Wright Co. on account, terms 2/10, n/30.

Mar. 9 Paid the amount owed on the invoice within the discount period.

Mar. 11 Discovered that $18,000 of the merchandise purchased on March 1 was defective and returned items, receiving credit for $17,640 [$18,000 - ($18,000 * 2%) ].

Mar. 18 Purchased $10,000 of merchandise from Wright Co. on account, terms n/30.

Mar. 20 Received a refund from Wright Co. for return on Mar. 11 less the purchase on Mar. 18.

Question

Business

Daniel Hanson

19 March, 20:16

Journalize entries for the following related transactions of Manville Heating & Air Company. Refer to the Chart of Accounts for exact wording of account titles.

Mar. 1 Purchased $90,000 of merchandise from Wright Co. on account, terms 2/10, n/30.

Mar. 9 Paid the amount owed on the invoice within the discount period.

Mar. 11 Discovered that $18,000 of the merchandise purchased on March 1 was defective and returned items, receiving credit for $17,640 [$18,000 - ($18,000 * 2%) ].

Mar. 18 Purchased $10,000 of merchandise from Wright Co. on account, terms n/30.

Mar. 20 Received a refund from Wright Co. for return on Mar. 11 less the purchase on Mar. 18.

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Answers (1)

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Yair Archer · Answer 1

See explanation section.

Explanation:

March 1, Purchased Debit $90,000

Accounts payable Credit $90,000

Note: To record the purchased on account.

March 9, Accounts payable Debit $90,000

Cash Credit $88,200

Purchased discount Credit $1,800

Calculation: $90,000 - ($90,000 * 2%) = $88,200

Note: To record the payment.

March 11, No journal entry required.

March 18, Purchased Debit $10,000

Accounts payable Credit $10,000

Note: To record the purchased on account.

March 20, Cash Debit $17,640

Refunds payable Credit $17,640

Note: To record the return.