Question

Sales-Related and Purchase-Related Transactions for Seller and Buyer Using Perpetual Inventory System

The following selected transactions were completed during April between Swan Company and Bird Company:

Apr.2.	Swan Company sold merchandise on account to Bird Company, $15,100, terms FOB shipping point, 2/10, n/30. Swan Company paid freight of $485, which was added to the invoice. The cost of the merchandise sold was $9,500.
8.	Swan Company sold merchandise on account to Bird Company, $31,000, terms FOB destination, 1/15, n/30. The cost of the merchandise sold was $18,600.
8.	Swan Company paid freight of $760 for delivery of merchandise sold to Bird Company on April 8.
12.	Bird Company paid Swan Company for purchase of April 2.
18.	Swan Company paid Bird Company a refund of $2,000 for defective merchandise in the April 2 purchase. Bird Company agreed to keep the merchandise.
23.	Bird Company paid Swan Company for purchase of April 8.
24.	Swan Company sold merchandise on account to Bird Company, $10,300, terms FOB shipping point, n/45. The cost of the merchandise sold was $6,200.
26.	Bird Company paid freight of $320 on April 24 purchase from Swan Company.
30.	Swan Company granted a customer allowance (credit memo) to Bird Company for $11,300 for merchandise that was returned from the August 24 purchase. The cost of the merchandise returned was $6,500.

Required:

1. Journalize the April transactions for Bird Company (the buyer).

Date	Account	Debit	Credit
Apr. 2

Date	Account	Debit	Credit
Apr. 8

Date	Account	Debit	Credit
Apr. 12-payment

Date	Account	Debit	Credit
Apr. 18

Date	Account	Debit	Credit
Apr. 23

Date	Account	Debit	Credit
Apr. 24

Date	Account	Debit	Credit
Apr. 26

Date	Account	Debit	Credit
Apr. 30

2. Journalize the April transactions for Swan Company (the seller).

Date	Account	Debit	Credit
Apr. 2-sale

Date	Account	Debit	Credit
Apr. 2-freight

Date	Account	Debit	Credit
Apr. 2-cost

Date	Account	Debit	Credit
Apr. 8-sale

Date	Account	Debit	Credit
Apr. 8-cost

Date	Account	Debit	Credit
Apr. 8-freight

Date	Account	Debit	Credit
Apr. 12-collection

Date	Account	Debit	Credit
Apr. 18

Date	Account	Debit	Credit
Apr. 23

Date	Account	Debit	Credit
Apr. 24-sale

Date	Account	Debit	Credit
Apr. 24-cost

Date	Account	Debit	Credit
Apr. 30

Date	Account	Debit	Credit
Apr. 30

Answer 1

Ans-

Req 1: IN THE BOOKS OF BIRD COMPANY
Date	Accounts title and explanations				Debit $	Credit $
2-Apr	Merchandise inventoryDr.				15585
	Accounts payable					15585
8-Apr	Merchandise inventoryDr.				31000
	Accounts payable					31000
12-Apr	Accounts payable Dr.				15585
	Merchandise Inventory (15100*2%)					302
	Cash					15283
18-Apr	Cash Dr.				2000
	Merchandise Inventory					2000
23-Apr	Accounts payable Dr.				31000
	Merchandise Inventory (31000*1%)					310
	cash					30690
24-Apr	Merchandise inventoryDr.				10300
	Accounts payable					10300
26-Apr	Merchandise Inventory				320
	Cash Account					320
30-Apr	Accounts payable Dr.				11300
	Merchandise Inventory					11300
Req 2: IN THE BOOKS OF SWAN COMPANY
Date	Accounts title and explanations				Debit $	Credit $
2-Apr	Accounts receivable Dr.				15100
	Sales revenue					15100
2-Apr	Accounts receivable Dr.				485
	Cash					485
2-Apr	Cost of Goods sold Dr.				9500
	Merchandise Inventory					9500
8-Apr	Accounts receivable Dr.				31000
	Sales revenue					31000
8-Apr	Cost of Goods sold Dr.				18600
	Merchandise Inventory					18600
8-Apr	Delivery expense Dr.				760
	cash					760
12-Apr	cash Dr.				15283
	Sales discount Dr. (15100*2%)				302
	Accounts receivable					15585
18-Apr	Sales discount and allowance Dr.				2000
	Cash Account					2000
23-Apr	cash Dr.				30690
	Sales discount Dr. (31000*1%)				310
	Accounts receivable					31000
24-Apr	Accounts receivable Dr.				10300
	Sales revenue					10300
	Cost of Goods sold Dr.				6200
	Merchandise Inventory					6200
30-Apr	Sales return Dr.				11300
	Accounts receivable					11300
30-Apr	Merchandise Inventory dr.				6500
	Cost of Goods sold					6500