Question

Sales-Related Transactions Using Perpetual Inventory System

The following selected transactions were completed by Green Lawn Supplies Co., which sells irrigation supplies primarily to other businesses and occasionally to retail customers:

July 1.	Sold merchandise on account to Landscapes Co., $59,820, terms FOB shipping point, n/eom. The cost of the goods sold was $33,100.
2.	Sold merchandise for $12,450 plus 6% sales tax to retail cash customers. The cost of the goods sold was $7,140.
5.	Sold merchandise on account to Peacock Company, $17,500, terms FOB destination, 1/10, n/30. The cost of the goods sold was $12,280.
8.	Sold merchandise for $29,100 plus 6% sales tax to retail customers who used VISA cards. The cost of the goods sold was $18,230.
13.	Sold merchandise to customers who used MasterCard cards, $13,030. The cost of the goods sold was $7,800.
14.	Sold merchandise on account to Loeb Co., $29,200, terms FOB shipping point, 1/10, n/30. The cost of the goods sold was $15,060.
15.	Received check for amount due from Peacock Company for sale on July 5.
16.	Issued credit memo to Loeb Co. for merchandise with an invoice amount of $4,300 returned from the sale on July 14. The cost of the merchandise returned was $2,630.
18.	Sold merchandise on account to Jennings Company, $9,000, terms FOB shipping point, 2/10, n/30. Paid $60 for freight and added it to the invoice. The cost of the goods sold was $5,250.
24.	Received check for amount due from Loeb Co. for sale on July 14 less credit memo of July 16.
28.	Received check for amount due from Jennings Company for sale of July 18.
31.	Paid Black Lab Delivery Service $5,530 for merchandise delivered during July to customers under shipping terms of FOB destination.
31.	Received check for amount due from Landscapes Co. for sale of July 1.
Aug. 3.	Paid Hays Federal Bank $800 for service fees for handling MasterCard and VISA sales during July.
10.	Paid $6,463 to state sales tax division for taxes owed on sales.

Required:

Journalize the entries to record the transactions of Green Lawn Supplies Co. If an amount box does not require an entry, leave it blank.

Answer 1

Journal Entries:
Date	Description	Debit	Credit
July 1	Accounts receivable -Landscapes Co.	$59,820
	To Sales		$59,820
	Cost of goods sold	$33,100
	To Inventory		$33,100
July 2	Cash	$13,197
	To Sales		$12,450
	To Sales tax (12450*6%)		$747
	Cost of goods sold	$7,140
	To Inventory		$7,140
July 5	Accounts receivable- Peacock Company	$17,500
	To Sales		$17,500
	Cost of goods sold	$12,280
	To Inventory		$12,280
July 8	Cash	$30,846
	To Sales		$29,100
	To Sales tax (29100*6%)		$1,746
	Cost of goods sold	$18,230
	To Inventory		$18,230
July 13	Cash	$13,030
	To Sales		$13,030
	Cost of goods sold	$7,800
	To Inventory		$7,800
July 14	Accounts receivable -Loeb Co	$29,200
	To Sales		$29,200
	Cost of goods sold	$15,060
	To Inventory		$15,060
July 15	Bank	$17,325
	Sales discount (17500*1%)	$175
	To Accounts receivable- Peacock Company		$17,500
July 16	Sales returns	$4,300
	To Accounts receivable -Loeb Co.		$4,300
	Inventory	$2,630
	To Cost of goods sold		$2,630
July 18	Accounts receivable -Jennings Company	$9,000
	To Sales		$9,000
	Accounts receivable -Jennings Company	$60
	To Cash		$60
	Cost of goods sold	$5,250
	To Inventory		$5,250
July 24	Bank	$24,651
	Sales discount (24900*1%)	$249
	To Accounts receivable- Loeb Co.		$24,900
July 28	Bank	$8,820
	Sales discount (9000*2%)	$180
	To Accounts receivable- Jennings Company		$9,000
July 31	Accounts payable -Black Lab Delivery Service	$5,530
	To Cash		$5,530
July 31	Bank	$59,820
	To Accounts receivable -Landscapes Co.		$59,820
Aug 3	Service fees	$800
	To Bank		$800
Aug 10	Sales tax	$6,463
	To Cash		$6,463