Question

The following selected transactions were completed by Amsterdam Supply Co., which sells office supplies primarily to wholesalers and occasionally to retail customers. Note that the company uses a clearing house to take care of all bank as well as non-bank credit cards used by its customers. Record on page 10 of the journal Mar. 2 Sold merchandise on account to Equinox Co., $18,900, terms FOB destination, 1/10, n/30. The cost of the merchandise sold was $13,300. 3 Sold merchandise for $11,350 plus 6% sales tax to retail cash customers. The cost of merchandise sold was $7,000. 4 Sold merchandise on account to Empire Co., $55,400, terms FOB shipping point, n/eom. The cost of merchandise sold was $33,200. 5 Sold merchandise for $30,000 plus 6% sales tax to retail customers who used MasterCard. The cost of merchandise sold was $19,400. 12 Received check for amount due from Equinox Co. for sale on March 2. 14 Sold merchandise to customers who used American Express cards, $13,700. The cost of merchandise sold was $8,350. 16 Sold merchandise on account to Targhee Co., $27,500, terms FOB shipping point, 1/10, n/30. The cost of merchandise sold was $16,000. 18 Issued credit memo for $4,800 to Targhee Co. for merchandise returned from sale on March 16. The cost of the merchandise returned was $2,900. Record on page 11 of the journal 19 Sold merchandise on account to Vista Co., $8,250, terms FOB shipping point, 2/10, n/30. Added $75 to the invoice for prepaid freight. The cost of merchandise sold was $5,000. 26 Received check for amount due from Targhee Co. for sale on March 16 less credit memo of March 18. 28 Received check for amount due from Vista Co. for sale of March 19. 31 Received check for amount due from Empire Co. for sale of March 4. 31 Paid Fleetwood Delivery Service $5,600 for delivery of merchandise in March to customers under shipping terms of FOB destination. Apr. 3 Paid City Bank $940 for service fees for handling MasterCard and American Express sales during March. 15 Paid $6,544 to state sales tax division for taxes owed on sales. Journalize the entries to record the transactions of Amsterdam Supply Co. Refer to the Chart of Accounts for exact wording of account titles.

Answer 1

S NO	Date	Journal	Debit	Credit		Working
1	March 2	Account Receivable-Equinox	18711			18900-(18900*1%)
		Sales		18711
		(Sold merchandise on account to Equinox Co, terms FOB destination, 1/10, n/30)
	March 2	Cost of Merchandise Sold	13300
		Inventory of Merchandise		13300
		(Sold merchandise on account to Equinox Co)
2	March 3	Cash	12031			11350+(11350*6%)
		Sales		11350
		Sales Tax Payable		681		11350*6%
		(Sold merchandise retail cash customers)
	March 3	Cost of Merchandise Sold	7000
		Inventory of Merchandise		7000
		(Sold merchandise retail cash customers)
3	March 4	Account Receivable-Empire	55400
		Sales		55400
		(Sold merchandise on account to Empire Co, terms FOB shipping, neom)
	March 4	Cost of Merchandise Sold	33200
		Inventory of Merchandise		33200
		(Sold merchandise on account to Empire Co, terms FOB shipping, neom)
4	March 5	Cash	31800			30000+(30000*6%)
		Sales		30000
		Sales Tax Payable		1800		30000*6%
		(Sold merchandise to retail customer for cash)
	March 5	Cost of Merchandise Sold	19400
		Inventory of Merchandise		19400
		(Sold merchandise to retail customer for cash)
5	March 12	Cash	18711
		Account Receivable-Equinox		18711
		(Received Cash from Equinox for sale)
6	March 14	Cash	13700
		Sales		13700
		(Sold merchandise to custmoer used American Express Card)
	March 14	Cost of Merchandise Sold	8350
		Inventory of Merchandise		8350
		(Sold merchandise to custmoer used American Express Card)
7	March 16	Account Receivable-Targhee Co	27225			27500-(27500*1%)
		Sales		27225
		(Sold merchandise on account to Targhee Co, terms FOB destination, 1/10, n/30)
	March 16	Cost of Merchandise Sold	16500
		Inventory of Merchandise		16500
		(Sold merchandise on account to Equinox Co)
8	March 18	Refund Payable	4752			4800-(4800*1%)
		Account Receivable-Targhee Co		4752
		(Sales Return from 16th March sale, issued credit memo)
	March 18	Inventory of Merchandise	2900
		Estimated Return Inventory		2900
		(Sales Return from 16th March sale, cost)
7	March 19	Account Receivable-Vista & Co	8160			8250-(8250*2%)+75
		Sales		8085		8250-(8250*2%)
		Cash		75
		(Sold to Vista term 2/10,n/30 with 75 freight in invoice)
	March 19	Cost of Merchandise Sold	5000
		Inventory of Merchandise		5000
		(Cost of Mechandise sold to Vista)
8	March 26	Cash	22473			27225-4752
		Account Receivable-Targhee		22473
		(Received Cheque from Targhee for sale less return)
9	March 28	Cash	8160
		Account Receivable-Vista Co		8160
		(Received Cheque from Vista)
10	March 31	Cash	55400
		Account Receivable-Empire		55400
		(Received Cheque from Empire)
11	March 31	Delivery Expense	5600
		Cash		5600
		(Paid Fleetwood Delivery Service for delivery of merchandise)
12	April 3	Credit Card Charges	940
		Cash		940
		(Paid for credit card handling)
13	April 15	Sales Tax Payable	6544
		Cash		6544
		(Paid to sales tax division)