Question

Purchase-Related Transactions Using Perpetual Inventory System

The following selected transactions were completed by Niles Co. during March of the current year:

Mar. 1.	Purchased merchandise from Haas Co., $17,600, terms FOB shipping point, 2/10, n/eom. Prepaid freight of $575 was added to the invoice.
5.	Purchased merchandise from Whitman Co., $14,150, terms FOB destination, n/30.
10.	Paid Haas Co. for invoice of March 1.
13.	Purchased merchandise from Jost Co., $9,900, terms FOB destination, 1/10, n/30.
14.	Issued debit memo to Jost Co. for $1,900 of merchandise returned from purchase on March 13.
18.	Purchased merchandise from Fairhurst Company, $12,350, terms FOB shipping point, n/eom.
18.	Paid freight of $300 on March 18 purchase from Fairhurst Company.
19.	Purchased merchandise from Bickle Co., $11,500, terms FOB destination, 2/10, n/30.
23.	Paid Jost Co. for invoice of March 13, less debit memo of March 14.
29.	Paid Bickle Co. for invoice of March 19.
31.	Paid Fairhurst Company for invoice of March 18.
31.	Paid Whitman Co. for invoice of March 5.

Required:

Journalize the entries to record the transactions of Britt Co. for March.

Mar. 1
Mar. 5
Mar. 10
Mar. 13
Mar. 14
Mar. 18-purchase
Mar. 18-freight
Mar. 19
Mar. 23
Mar. 29
Mar. 31-Fairhurst
Mar. 31-Whitman

Answer 1

SOLUTION

Date	Accounts titles and Explanation	Debit ($)	Credit ($)
Mar.1	Merchandise inventory	17,823
	Accounts payable - Haas Co.		17,823
	[17,600-(17,600*2%)+575]
Mar.5	Merchandise inventory	14,150
	Accounts payable - Whitman Co.		14,150
Mar.10	Accounts payable - Haas Co.	17,823
	Cash		17,823
Mar.13	Merchandise inventory	9,801
	Accounts payable - Jost Co. [$9,900-(9,900*1)]		9,801
Mar.14	Accounts payable - Jost Co.	1,881
	Merchandise inventory [1,900-(1,900*1)]		1,881
Mar.18	Merchandise inventory	12,350
	Accounts payable - Fairhurst Company		12,350
Mar.18	Merchandise inventory	300
	Cash		300
Mar.19	Merchandise inventory	11,270
	Accounts payable - Bickle Co. [11,500-(11,500*2%)]		11,270
Mar. 23	Accounts payable - Jost Co.	7,920
	Cash (9,801-1,881)		7,920
Mar.29	Accounts payable - Bickle Co.	11,270
	Cash		11,270
Mar.31	Accounts payable - Fairhurst Company	12,350
	Cash		12,350
Mar. 31	Accounts payable - Whitman Co.	14,150
	Cash		14,150