Question

Prepare journal entries to record the following transactions on Novy Company's books using a perpetual inventory system.

On March 2, Novy Company sold $971,000 of merchandise to Opps Company, terms 2/10, n/30. The cost of the merchandise sold was $522,000.

Account Titles and Explanation	Debit	Credit
(To record credit sale)

(To record cost of merchandise sold)

On March 6, Opps Company returned 97,100 of the merchandise purchased on March 2. The cost of the returned merchandise was 61,000.

Account Titles and Explanation	Debit	Credit
(To record merchandise returned)
(To record cost of merchandise returned)

On March 12, Novy Company recieved the balance due from Opps Company.

Account Titles and Explanation	Debit	Credit

Answer 1

Please hit LIKE button if this helped. For any further explanation, please put your query in comment, will get back to you.

On March 2, Novy Company sold $971,000 of merchandise to Opps Company, terms 2/10, n/30. The cost of the merchandise sold was $522,000.
Account	Debit	Credit
Accounts Receivable	971000
Sales		971000
(to record credit sale)
Cost of Goods Sold	522000
Merchandise Inventory		522000
(to record cost of merchandise sold)
On March 6, Opps Company returned 97,100 of the merchandise purchased on March 2. The cost of the returned merchandise was 61,000.
Sales Return and Allowance	97100
Accounts Receivable		97100
(To record merchandise Returned)
Merchandise Inventory	61000
Cost of Goods Sold		61000
(to record cost of merchandise Returned)
On March 12, Novy Company recieved the balance due from Opps Company.
Cash	856422
Sales Discount	17478
Accounts Receivable		873900
(To record receipt of payment)
Working:
Sales Eligible for Payment	971000-97100	873900
Since payment is made within 10 days, 2% discount		17478
Cash Received	873900-17478	856422