P5-1A | Powell’s Book Warehouse distributes hardcover books to retail stores and extends credit term 0f 2/10, | ||||||||||
n/30 to all of its customers. At the end of May, Powell’s inventory consisted of books purchased for | |||||||||||
$1,800. During June, the following merchandising transactions occurred. | |||||||||||
June | 1 | Purchased books on account for $ 1,600 from Kline Publishers, FOB destination, terms 2/10, | |||||||||
n/30. The appropriate party also made a cash payment of $50 for the freight on this date. | |||||||||||
3 | Sold books on account to Reading Rainbow for $2,500. The cost of the books sold was $1,440. | ||||||||||
6 | Received $100 credit for books returned to Kline Publishers. | ||||||||||
9 | Paid Kline Publishers in full, less discount. | ||||||||||
15 | Received payment in full from Reading Rainbow. | ||||||||||
17 | Sold books on account to Blanco Books for $1,800. The cost of the books sold was $1,080. | ||||||||||
20 | Purchased books on account for $1,500 from Dietz Publishers, FOB destination, terms 2/15,n/30. | ||||||||||
The appropriate party also made a cash payment of $50 for the freight on this date. | |||||||||||
24 | Received payment in full from Blanco Books. | ||||||||||
26 | Paid Dietz Publishers in full less discount. | ||||||||||
28 | Sold books on account to Reddy Bookstore for $1,400. The cost of the books sold was $850. | ||||||||||
30 | Granted Reddy Bookstore $120 credit for books returned costing $72. | ||||||||||
Powell’s Book Warehouse’s chart of accounts includes the following: No.101 Cash, No.112, Accounts Receivable, | |||||||||||
No.120 Inventory, No. 201 Accounts Payable, No. 401 Sales Revenue, No.412 Sales Returns and Allowances, No. 414 | |||||||||||
Sales Discounts, and No. 595 Cost of Goods Sold. | |||||||||||
Instructions | |||||||||||
Journalize the transactions for the month of June for Powell’s Book Warehouse using a perpetual inventory system. | |||||||||||
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