Question

Problem 1

Record the journal entries for the following transactions that occurred during the month of December for Magic Merchandisers, I. nc using a perpetual inventory system.

Dec. 1^st: Purchased merchandise on account from Starlight Inc., list price $24,000, terms FOB destination 2/10, n/30.

Dec. 3^rd: Purchased merchandise on account from Oriental Industries $18,500 terms 1/10, n/30, FOB shipping point. $1,800 in freight cost was added to the invoice.

Dec. 5^th: Returned $4,000 of merchandise to Starlight Inc.

Dec. 11^th: Paid Starlight Inc. for Dec. 1^st purchase less return of Dec. 5^th and discount.

Dec. 12^th: Sold merchandise inventory on account to Magic R Us for $16,500 terms 2/10, n/30, FOB destination. The cost of merchandise sold was $6,800.

Dec. 13^th: Paid Oriental Industries for Dec. 3^rd purchase, less discount.

Dec. 15^th: Sold merchandise inventory for $7,400 to Houdini. Houdini used a credit card to purchase the inventory. The cost of merchandise sold was $3,200.

Dec. 17^th: Houdini returned $3,300 of inventory. Cost of the merchandise returned equaled $1,850.

Dec. 21^st: Received cash on account from Dec. 12^th sale to Magic R Us, less discount.

Dec. 24^th: Sold merchandise inventory on account to Magik, list price $6,600 terms FOB destination 2/10, n/30. The cost of merchandise sold was $3,350.

Dec. 29^th: Paid credit card fees to National Processing Center $440.

Answer 1

Date	Accounts Name	Debit	Credit
Dec. 1st	Inventory	24000
	Accounts Payable-Starlight		24000
	(being purchase made on account)
Dec. 3rd	Inventory	18500
	Accounts Payable-oriental		18500
	(being purchase made on account)
Dec 5th	Accounts Payable-Starlight	4000
	Inventory		4000
	(being inventory return recorded)
Dec.11	Accounts Payable-Starlight	20000
	Inventory		400
	Cash		19600
	(being AP Paid)
Dec.12	Accounts Receivable-Magic R	16500
	Sales Revenue		16500
	(being sales made)
Dec.12	Cost of Goods Sold	6800
	Inventory		6800
	(being COGS recorded)
Dec. 13	Accounts Payable-Starlight	18500
	Inventory		185
	Cash		18315
	(being AP Paid)
Dec.15	Cash	7400
	Sales Revenue		7400
	(being sales made)
Dec.15	Cost of Goods Sold	3200
	Inventory		3200
	(being COGS recorded)
Dec.17	Sales Return and Allowances	3300
	Cash		3300
	(being sales return made)
Dec.17	Inventory	1850
	Cost of Goods Sold		1850
	(being cogs recognised)
Dec.21	Cash	16170
	Sales return and alowance	330
	Accounts Receivable-Magic R		16500
Dec. 24	Accounts Receivable-Magik	6600
	Sales Revenue		6600
	(being sales made)
	Cost of Goods Sold	3350
	Inventory		3350
	(being COGS recorded)
Dec.29	Credit Card Charges	440
	Cash		440
	(being credit card fees paid)
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