Question

Church Company completes these transactions and events during March of the current year (terms for all its credit sales are 2/10, n/30). Mar. 1 Purchased $43,600 of merchandise from Van Industries, invoice dated March 1, terms 2/15, n/30. Mar. 2 Sold merchandise on credit to Min Cho, Invoice No. 854, for $16,800 (cost is $8,400). Mar. 3 Purchased $1,230 of office supplies on credit from Gabel Company, invoice dated March 3, terms n/10 EOM. Mar. 3 Sold merchandise on credit to Linda Witt, Invoice No. 855, for $10,200 (cost is $5,800). Mar. 6 Borrowed $82,000 cash from Federal Bank by signing a long-term note payable. Mar. 9 Purchased $21,850 of office equipment on credit from Spell Supply, invoice dated March 9, terms n/10 EOM. Mar. 10 Sold merchandise on credit to Jovita Albany, Invoice No. 856, for $5,600 (cost is $2,900). Mar. 12 Received payment from Min Cho for the March 2 sale less the discount. Mar. 13 Sent Van Industries Check No. 416 in payment of the March 1 invoice less the discount. Mar. 13 Received payment from Linda Witt for the March 3 sale less the discount. Mar. 14 Purchased $32,625 of merchandise from the CD Company, invoice dated March 13, terms 2/10, n/30. Mar. 15 Issued Check No. 417, payable to Payroll, in payment of sales salaries expense for the first half of the month, $18,300. Cashed the check and paid the employees. Mar. 15 Cash sales for the first half of the month are $34,680 (cost is $20,210). (Cash sales are recorded daily, but are recorded only twice here to reduce repetitive entries.) Mar. 16 Purchased $1,770 of store supplies on credit from Gabel Company, invoice dated March 16, terms n/10 EOM. Mar. 17 Received a $2,425 credit memorandum from CD Company for the return of unsatisfactory merchandise purchased on March 14. Mar. 19 Received a $630 credit memorandum from Spell Supply for office equipment received on March 9 and returned for credit. Mar. 20 Received payment from Jovita Albany for the sale of March 10 less the discount. Mar. 23 Issued Check No. 418 to CD Company in payment of the invoice of March 13 less the March 17 return and the discount. Mar. 27 Sold merchandise on credit to Jovita Albany, Invoice No. 857, for $14,910 (cost is $7,220). Mar. 28 Sold merchandise on credit to Linda Witt, Invoice No. 858, for $4,315 (cost is $3,280). Mar. 31 Issued Check No. 419, payable to Payroll, in payment of sales salaries expense for the last half of the month, $18,300. Cashed the check and paid the employees. Mar. 31 Cash sales for the last half of the month are $30,180 (cost is $16,820). - GENERAL JOURNAL

Answer 1

Let us understand what is 2/10 and N/30

This means that if we pay in 10 days we can take 2% discount. If we don t pay in 30 days we have to pay the net amount

Description Debit (amount) Credit(amount)

1. Purchases A/C Dr 43600

To Van Industries 43600

2. Mincho A/C DR 16800

To sales 16800

3. Purchases A/C Dr 1230

To Gabel company 1230

4. Lina A/C Dr 10200

To sales 10200

5.cASH A/C Dr 82000

To accounts payable 82000

6. Purchases A/C Dr 21850

To spell supply 21850

7. Jovita albony a/c Dr 5600

To sales A/C 5600

8. Cash a/c Dr 5600

To Mincho 5600

9. Van industries a/c Dr 42,728(43600- 2% discount)

To cash 42,728/

10/ Cash A/C Dr 10200

To Linda 10200

11. Purchases A/C dR 32625

To CD company 32625

12. Salaries A/C dR 9150(18300*6/12)

To cash 9150

13. Cash a.c dr 17340(34680*6/12)

To sales 17340

14. Purchases A/C dR 1770

To Gabel company A/C 1770

15. CD company A/C DR 2425

To Purchases return 2425

16. Spell supply a/c Dr 630

To purchases return 630

17. Cash a/c Dr 5600

To jovita albany 5600

18, Calculation of discount

32625*2%

=Rs 31973

Deduct returns= 31973-2425= Rs 29548

CD Company AC dr 29548

To cash 29548

19. Jovita albony a/c Dr 14910

To sales 14910

20 Linda witt a/c Dr 4315

To sales 4315

21. Salaries A/C DR 9150(18300*6/12)

To cash 9150.

22. cash a/c Dr 15090

To sales 15090