Question

Olaf Corp. uses a perpetual inventory system. The company had the following inventory transactions in April:

April	3		Purchased merchandise from Flounder Ltd. for $30,700, terms 1/10, n/30, FOB shipping point.
	6		The appropriate company paid freight costs of $660 on the merchandise purchased on April 3.
	7		Purchased supplies on account for $5,490.
	8		Returned damaged merchandise to Flounder and was given a purchase allowance of $3,700. The merchandise was repaired by Flounder and returned to inventory for future resale.
	30		Paid the amount due to Flounder in full.

1.		The cost of the merchandise sold on April 3 was $18,030.
2.		The cost of the merchandise returned on April 8 was $2,400.
3.		Flounder uses a perpetual inventory system.

ecord the transactions in the books of Flounder. (Credit account titles are automatically indented when the amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts.)

Date	Account Titles and Explanation	Debit	Credit
Apr. 3
	(To record credit sale)
3
	(To record cost of merchandise sold)
6
7
8
	(To record return of goods)
8
	(To record cost of merchandise returned)
30

Answer 1

Date	Account Titles and Explanation	Debit	Credit
Apr 3	Accounts Receivable	30700
	Sales		30700
	(To record credit sale)
3	Cost of goods sold	18030
	Inventory		18030
	(To record cost of merchandise sold)
6	No entry	0
	No entry		0
7	No entry	0
	No entry		0
8	Sales return and allowances	3700
	Accounts Receivable		3700
	(To record return of goods)
8	Inventory	2400
	Cost of goods sold		2400
	(To record cost of merchandise returned)
30	Cash	27000		=30700-3700
	Accounts Receivable		27000