journalize the following merchandise transactions, using the net method under a perpetual inventory system.
a. Sold merchandise on account, $24,600 with terms 1/10, n/30. The cost of the goods sold was $14,760. If an amount box does not require an entry, leave it blank.
Accounts Receivable
24,354
Sales
24,354
Cost of Goods Sold
14,760
Inventory
14,760
b. Received payment less the discount. If an amount box does not require an entry, leave it blank.
Cash
24,600(wrong)
Accounts Receivable
24,600(wrong)
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(b) The exercise assumes the invoice will be paid within the discount period, so the seller records the sale at the discounted amount.
c. Refunded $420 to customer for defective merchandise that was not returned. If an amount box does not require an entry, leave it blank.
Customer Refunds Payable
420
Cash
420
To journalize the merchandise transactions using the net method under a perpetual inventory system, you need to follow these steps:
a. Sold merchandise on account, $24,600 with terms 1/10, n/30. The cost of the goods sold was $14,760.
To journalize this transaction:
Debit Accounts Receivable for $24,354 (the selling price after the discount of 1% is applied).
Credit Sales for $24,354.
Debit Cost of Goods Sold for $14,760.
Credit Inventory for $14,760.
b. Received payment less the discount.
Since the payment is received within the discount period (1/10), we need to record the sale at the discounted amount.
To journalize this transaction:
Debit Cash for the full amount, $24,600.
Credit Accounts Receivable for $24,600.
c. Refunded $420 to the customer for defective merchandise that was not returned.
To journalize this transaction:
Debit Customer Refunds Payable for $420.
Credit Cash for $420.
By following the steps mentioned above, you can correctly journalize the merchandise transactions under the net method in a perpetual inventory system.