Redmon Company uses a sales journal, a purchases journal, a cash receipts journal, a cash disbursements
journal, and a general journal. The following transactions occur in the month of June.
June 1 Purchased $8,100 of merchandise on credit from Vick, Inc., terms n�30.
8 Sold merchandise costing $900 on credit to R. Panke for $1,500 subject to a $30 sales discount
if paid by the end of the month.
14 Purchased $240 of store supplies from Poe Company on credit, terms n�30.
17 Purchased $260 of office supplies on credit from Rehmer Company, terms n�30.
24 Sold merchandise costing $400 to L. Barnett for $630 cash.
28 Purchased store supplies from Piburn’s for $90 cash.
29 Paid Vick, Inc., $8,100 cash for the merchandise purchased on June 1.
Prepare headings for a purchases journal like the one in Exhibit 7.9. Journalize the June transactions
To journalize the June transactions using a purchases journal, you will need to set up the appropriate column headings for the journal. The columns typically include Date, Account Credited, Invoice Number, Accounts Payable Debit, Cash Debit, and Merchandise Inventory Credit.
Here is how you can set up the headings for the purchases journal:
| Date | Account Credited | Invoice Number | Accounts Payable Debit | Cash Debit | Merchandise Inventory Credit |
|------|-----------------|----------------|------------------------|------------|-----------------------------|
| | | | | | |
Now let's journalize the June transactions based on the information provided:
1. June 1: Purchased $8,100 of merchandise on credit from Vick, Inc., terms n/30.
Journal entry:
| Date | Account Credited | Invoice Number | Accounts Payable Debit | Cash Debit | Merchandise Inventory Credit |
|---------|-----------------|----------------|------------------------|------------|-----------------------------|
| June 1 | Vick, Inc. | | $8,100 | | |
8. June 8: Sold merchandise costing $900 on credit to R. Panke for $1,500, subject to a $30 sales discount if paid by the end of the month.
Journal entry:
| Date | Account Credited | Invoice Number | Accounts Payable Debit | Cash Debit | Merchandise Inventory Credit |
|--------|-----------------|----------------|------------------------|------------|-----------------------------|
| June 8 | | | $900 | | $900 |
14. June 14: Purchased $240 of store supplies from Poe Company on credit, terms n/30.
Journal entry:
| Date | Account Credited | Invoice Number | Accounts Payable Debit | Cash Debit | Merchandise Inventory Credit |
|--------|-----------------|----------------|------------------------|------------|-----------------------------|
| June 14| Poe Company | | $240 | | |
17. June 17: Purchased $260 of office supplies on credit from Rehmer Company, terms n/30.
Journal entry:
| Date | Account Credited | Invoice Number | Accounts Payable Debit | Cash Debit | Merchandise Inventory Credit |
|--------|-----------------|----------------|------------------------|------------|-----------------------------|
| June 17| Rehmer Company | | $260 | | |
24. June 24: Sold merchandise costing $400 to L. Barnett for $630 cash.
Journal entry:
| Date | Account Credited | Invoice Number | Accounts Payable Debit | Cash Debit | Merchandise Inventory Credit |
|--------|-----------------|----------------|------------------------|------------|-----------------------------|
| June 24| | | | $630 | $400 |
28. June 28: Purchased store supplies from Piburn's for $90 cash.
Journal entry:
| Date | Account Credited | Invoice Number | Accounts Payable Debit | Cash Debit | Merchandise Inventory Credit |
|--------|-----------------|----------------|------------------------|------------|-----------------------------|
| June 28| Piburn's | | $90 | $90 | |
29. June 29: Paid Vick, Inc., $8,100 cash for the merchandise purchased on June 1.
Journal entry:
| Date | Account Credited | Invoice Number | Accounts Payable Debit | Cash Debit | Merchandise Inventory Credit |
|--------|-----------------|----------------|------------------------|------------|-----------------------------|
| June 29| | | | $8,100 | |
Please note that the "Account Credited" column is used to record the supplier/vendor's name, and the "Invoice Number" column can be used to record the specific invoice number for each transaction if necessary. Also, adjust the header widths according to your needs when journalizing the transactions in a physical journal.
The purchases journal is used to record all purchases of merchandise on credit. The headings for the purchases journal are as follows:
Date | Account Credited | Invoice Number | Purchases | Accounts Payable | Other Accounts
Now let's journalize the June transactions:
June 1:
- Purchased $8,100 of merchandise on credit from Vick, Inc.
- Terms: n/30
Journal entry:
Date | Account Credited | Invoice Number | Purchases | Accounts Payable | Other Accounts
June 1 | Vick, Inc. | Invoice #1 | $8,100 | $8,100 |
June 8:
- Sold merchandise costing $900 on credit to R. Panke for $1,500.
- Subject to $30 sales discount if paid by the end of the month.
Journal entry:
Date | Account Credited | Invoice Number | Purchases | Accounts Payable | Other Accounts
June 8 | R. Panke | Invoice #2 | | $1,470 | Sales Discount
June 14:
- Purchased $240 of store supplies on credit from Poe Company.
- Terms: n/30
Journal entry:
Date | Account Credited | Invoice Number | Purchases | Accounts Payable | Other Accounts
June 14 | Poe Company | Invoice #3 | $240 | $240 |
June 17:
- Purchased $260 of office supplies on credit from Rehmer Company.
- Terms: n/30
Journal entry:
Date | Account Credited | Invoice Number | Purchases | Accounts Payable | Other Accounts
June 17 | Rehmer Company | Invoice #4 | $260 | $260 |
June 24:
- Sold merchandise costing $400 to L. Barnett for $630 cash.
Journal entry:
Date | Account Credited | Invoice Number | Purchases | Accounts Payable | Other Accounts
June 24 | L. Barnett | Invoice #5 | | | $630
June 28:
- Purchased store supplies from Piburn's for $90 cash.
Journal entry:
Date | Account Credited | Invoice Number | Purchases | Accounts Payable | Other Accounts
June 28 | Piburn's | Invoice #6 | $90 | |
June 29:
- Paid Vick, Inc., $8,100 cash for the merchandise purchased on June 1.
Journal entry:
Date | Account Credited | Invoice Number | Purchases | Accounts Payable | Other Accounts
June 29 ||| | $8,100 |
Note: In the purchases journal, the "Purchases" column is used to record the total amount of purchases made on credit, and the "Accounts Payable" column is used to record the amount owed to the respective vendor. The "Other Accounts" column is used for any additional accounts involved in the transaction, such as sales discount or cash payment.