Question

[The following information applies to the questions displayed below.] At the beginning of July, CD City has a balance in the inventory of $2,600. The following transactions occur during the month of July. July 3 Purchase CDs on account from Wholesale Music for $1,500, terms 1/10, n/30. July 4 Pay cash for freight charges related to the July 3 purchase from Wholesale Music, $110. July 9 Return incorrectly ordered CDs to Wholesale Music and receive credit, $200. July 11 Pay Wholesale Music in full. July 12 Sell CDs to customers on account, $4,200, that had a cost of $2,200. July 15 Receive full payment from customers related to the sale on July 12. July 18 Purchase CDs on account from Music Supply for $2,300, terms 1/10, n/30. July 22 Sell CDs to customers for cash, $3,400, that had a cost of $1,700. July 28 Return CDs to Music Supply and receive credit of $140. July 30 Pay Music Supply in full. Problem 6-3A Part 1 Required: 1. Assuming that CD City uses a perpetual inventory system, record the transactions. (If no entry is required for a transaction/event, select "No Journal Entry Required" in the first

1. Assuming that CD City uses a perpetual inventory system, record the transactions. (If no entry is required for a transaction/event, select "No Journal Entry Required" in the first account field.)

Answer 1

Date	Account Title	Debit	Credit
3-Jul	Inventory	1500
	Accounts payable		1500
	terms 1/10, n/30
4-Jul	Inventory	110
	Cash		110
	(Freight on above purchase)
9-Jul	Accounts payable	200
	Inventory		200
	(Purchases returns)
11-Jul	Accounts payable(1500-200)	1300
	Inventory(1300*1%)		13
	Cash(Bal.)		1287
12-Jul	Accounts receivbale	4200
	Sales		4200
	Cost of goods sold	2200
	Inventory		2200
15-Jul	Cash	4200
	Accounts receivbale		4200
18-Jul	Inventory	2300
	Accounts payable		2300
	terms 1/10, n/30
22-Jul	Cash	3400
	Sales		3400
	Cost of goods sold	1700
	Inventory		1700
28-Jul	Accounts payable	140
	Inventory		140
	(Purchases returns)
	Accounts payable(2300-140)	2160
	Cash		2160
	(Pmt. After 10 days)