Question

) The following selected transactions were completed during July between All Ways Trading Co

                   and Supervalu Co

July 2.    All Ways company sold merchandise on account to Supervalu Company, $16,000, terms FOB

shipping point, 2/10, n/30 and paid freight of $375, which was added to the invoice.

The cost of goods sold was $11,000.

                     12.   Supervalu Co paid All Ways Co for purchase of July 2 invoice, less discount.

                     24.   All Ways Co sold merchandise on account to Supervalu Co, $13,200. Terms FOB shipping point,

                             n/eom. The cost of goods sold was $ 10,000.

                     26.   Supervalu Co paid freight of $ 190 on July 24 purchase from All Ways Co.

                     30.   Supervalu Co paid All Ways Co on account for July 24 purchase.

              Journalize transaction for the month of July for (1) All Ways Co, and (2) Supervalu Co, assuming both the

companies use perpetual inventory system.

Answer 1

Journal entry in book of All ways trading

Date	Accounts and explanations	Debit $	Credit $
July 2	Accounts receivable	$16000
	Sales revenue		$16000
	(To record sales revenue)
July 2	Cost of Good sold	$11,000
	Inventory		$11,000
	(To record Cost of Good sold)
July 12	Cash	$15687.50
	Sales discount and allowance ($16000-$375)*2%	$312.50
	Account receivable		$16,000
	(To record payment received)
July 24	Account receivable	$13,200
	Sales revenue		$13,200
	(To record sales revenue)
July 24	Cost of Good sold	$10000
	Inventory		$10000
	(To record Cost of Good sold)
July 26	No entry
July 30	Cash	$13200
	Account receivables		$13200
	(To record payment received)

Journal entry in book of Supervalu Co,

Date	Accounts and explanations	Debit $	Credit $
July 2	Inventory	$16000
	Account payable		$16000
	(To record purchase)
July 12	Accounts payable	$16000
	Inventory ($16000-$375)*2%	$312.50	$312.50
	Cash		$15687.50
	(To record payment made)
July 24	Inventory	$13,200
	Accounts payable		$13,200
	(To record sales revenue)
July 26	Inventory	$190
	Cash		$190
	(To record freight)
July 30	Accounts payable	$13200
	Cash		$13200
	(To record payment made)