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Annie's Antiques uses a perpetual inventory system. Journalize the following sales transactions for Annie's Antiques. Explanations...

Annie's Antiques uses a perpetual inventory system. Journalize the following sales transactions for Annie's Antiques. Explanations are not required. The company estimates sales returns at the end of each month.

Jan. 4 Sold $ 19,000 of antiques on​ account, credit terms are​ n/30. Cost of goods is $ 9,500.

Jan 8 Received a $ 100 sales return on damaged goods from the customer. Cost of goods damaged is $ 50.

Jan 13 Annie's Antiques received payment from the customer on the amount due from Jan. ​4, less the return.

Jan 20 Sold $ 5,000 of antiques on​ account, credit terms are 1​/10, ​n/45, FOB destination. Cost of goods is $ 2,500. Jan 20 Annie's Antiques paid $ 110 on freight out.

Jan 29 Received payment from the customer on the amount due from Jan. ​20, less the discount.

Solutions

Expert Solution

Journal Entries:

Date Account Titles and Explanations Debit Credit
Jan. 4 Accounts Receivable $19,000
    Sales Revenue $19,000
(To record the sale of goods on account)
Cost of Goods Sold $9,500
    Merchandise Inventory $9,500
(To record the cost of goods sold)
Jan. 8 Sales Returns and Allowances $100
    Accounts Receivable $100
(To record the return of goods sold on account)
Merchandise Inventory $50
   Cost of Goods Sold $50
(To record the return of the cost of goods sold)
Jan. 13 Cash $18,900
    Accounts Receivable ($19,000 - $100) $18,900
(To record the collection of cash from the credit customers)
Jan. 20 Accounts Receivable $5,000
    Sales Revenue $5,000
(To record the sale of goods on account)
Cost of Goods Sold $2,500
    Merchandise Inventory $2,500
(To record the cost of goods sold)
Jan. 20 Freight Charges $110
   Cash $110
(To record the payment of freight charges by cash)
Jan. 29 Cash $4,950
   Accounts Receivable ($5,000 - [$5,000*1/100]) $4,950
(To record the collection of cash from the credit customers less discount)

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