This information relates to Rice Co. 1.On April 5, purchased merchandise on account from...

E5-2 This information relates to Rice Co. 1.

On April 5, purchased merchandise on account from Jax Company for $28,000, terms 2/10, n/30. 2.

On April 6, paid freight costs of $700 on merchandise purchased from Jax. 3.

On April 7, purchased equipment on account for $30,000. 4.

On April 8, returned $3,600 of April 5 merchandise to Jax Company. 5.

On April 15, paid the amount due to Jax Company in full.

Instructions

a. Prepare the journal entries to record the transactions listed above on Rice Co.'s books. Rice Co. uses a perpetual inventory system.

b. Assume that Rice Co. paid the balance due to Jax Company on May 4 instead of April 15. Prepare the journal entry to record this payment.

Expert Solution

Journal entry

Date	account and explanation	Debit	Credit
Apr 5	Merchandise inventory	28000
	Account payable		28000

Apr 6	Merchandise inventory	700
	Cash		700

Apr 7	Equipment	30000
	Account payable		30000

Apr 8	Account payable	3600
	Merchandise inventory		3600

Apr 15	Account payable (28000-3600)	24400
	Cash		23912
	Merchandise inventory		488

B) Journal entry

Date	account and explanation	Debit	Credit
may 4	Account payable (28000-3600)	24400
	Cash		24400

ekkarill92 answered 2 years ago

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