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In: Accounting

The following are selected transactions of Watsonia Stores: 12 July   Sold goods on account to Viewbank...

The following are selected transactions of Watsonia Stores:

12 July   Sold goods on account to Viewbank Market for $1200, terms 2/10, n/30. The cost of the goods sold was $800.

19 July Forwarded a credit note for $90 to Viewbank Market covering part of the goods sold on 12 July, which cost $60, that were returned by Viewbank Market as inappropriate. The goods returned were not defective.

21 July Received from Viewbank Market a cheque in full settlement of the above transactions.

Both Watsonia Stores and Viewbank Market use perpetual inventory system. Assuming that neither business is registered for GST.

Required

Record the above transactions in the general journal of

(1) Watsonia Stores (5.5 marks), and

(2) Viewbank Market (3.5 marks)

(Both account names and figures should be correct in order)

Solutions

Expert Solution

1. Watsonia Stores

12 July

Dr Viewbank Market account $1200

Cr Sales account $800

Cr Profit/loss account $400

19 July

Dr Viewbank Market account  $60

Cr Sales returns account     $60

21 July

Dr Bank   $1200

Cr Viewbank Market account $1200

2. Viewbank Market

12 July

Dr Purchases purchases $1200

Cr Watsonia stores account $1200

19 July

Dr Purchases return Account $60

Cr Watsonia Stores account $60

21 July

Dr Watsonia Stores account $1200

Cr Bank $1200

ekkarill92 answered 2 years ago
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