Question

Prepare journal entries to record the merchandising transactions ("transactions tab") of Hetfield, Inc., which uses the perpetual inventory system and gross method. Use the "JE tab" to journalize your transactions. Hint: It will be helpful to identify each receivable and payable; for example, record the purchase on May 2 in Accounts Payable - Bon Jovi.

April 2- Purchased merchandise from Bon Jovi for 15,000 under credit terms of 2/15, n/30, FOB shipping point, invoice dated April 2.

April 4- Sold merchandise to Van Halen for 8,000 under credit terms of 1/10, n/60, FOB shipping point, invoice dated April 4. The merchandise had a cost of 5,500.

April 5- Paid 500 cash for freight charges on the purchase of April 2.

April 9- Sold merchandise that had a cost of 2,500 for 4,000 cash

April 10- Purchased merchandise from Roth for 3,000 under credit terms of 1/15, n/60, FOB destination, invoice dated April 10.

April 12- Returned 800 of merchandise purchased on April 10 from Roth and debited its account payable for that amount.

April 14- Received the balance due from Van Halen for the invoice date April 4, net of the discount.

April 17- Received the balance due from Van Halen for the invoice date April 4, net of the discount.

April 20- Sold merchandise that cost 6,000 to Dee Snyder for 9,000 under credit terms of 1/15, n/60, FOB shipping point, invoice dated April 20.

April 22- Gave a price reduction (allowance) of 500 to Dee Snyder for merchandise sold on April 20 and credited Dee Snyder's accounts receivable for the amount.

April 25- Paid Roth the balance due, net of the amount.

April 29-  Received the balance due from Dee Snyder for the invoice date April 20, net of discount and allowance.

April 30- Sold merchandise that cost 12,000 to Freddie Mercury for 18,000 under credit terms of 1/15, n/60, FOB shipping point, invoice dated April 30.

Answer 1

Important Note: Transaction dated April 17 is the same as the transaction dated April 14 and hence has been recorded only once at April 14. For any clarifications kindly write under comments.

Date	Account Titles and Explanation	Debit	Credit
Apr-02	Inventory	15000
	Accounts payable-Bon Jovi		15000
	(To record inventory purchased on account)
Apr-04	Accounts receivable-Van Halen	8000
	Sales revenue		8000
	(To record sales on account)
Apr-04	Cost of goods sold	5500
	Inventory		5500
	(To record the cost of the goods sold)
Apr-05	Inventory	500
	Cash		500
	(To record freight paid on inventory purchases)
Apr-09	Cash	4000
	Sales revenue		4000
	(To record cash sales)
Apr-09	Cost of goods sold	2500
	Inventory		2500
	(To record the cost of the goods sold)
Apr-10	Inventory	3000
	Accounts payable-Roth		3000
	(To record inventory purchased on account)
Apr-12	Accounts payable-Roth	800
	Inventory		800
	(To record inventory returned)
Apr-14	Cash	7920
	Sales discount (1% x $8000)	80
	Accounts receivable-Van Halen		8000
	(To record collection on account)
Apr-20	Accounts receivable-Dee Snyder	9000
	Sales revenue		9000
	(To record sales on account)
Apr-20	Cost of goods sold	6000
	Inventory		6000
	(To record the cost of the goods sold)
Apr-22	Sales returns and allowances	500
	Accounts receivable-Dee Snyder		500
	(To record price reduction given)
Apr-25	Accounts payable-Roth ($3000 - $800)	2200
	Inventory (1% x $2200)		22
	Cash		2178
	(To record payment on account)
Apr-29	Cash	8415
	Sales discount (1% x $8500)	85
	Accounts receivable-Dee Snyder ($9000 - $500)		8500
	(To record collection on account)
Apr-30	Accounts receivable-Van Halen	18000
	Sales revenue		18000
	(To record sales on account)
Apr-30	Cost of goods sold	12000
	Inventory		12000
	(To record the cost of the goods sold)