In: Accounting
Prepare the journal entries to record the following sales
transactions in Pina Colada Corp.’s books. Pina Colada uses a
perpetual inventory system. (Credit account titles are
automatically indented when the amount is entered. Do not indent
manually. If no entry is required, select "No Entry" for the
account titles and enter 0 for the amounts. Round answers to 0
decimal places, e.g. 125.)
Jan. | 2 | Pina Colada sold $45,900 of goods to Xtra Inc., terms 2/10, n/45, FOB destination. The cost of the goods sold was $25,704. | |
5 | The appropriate company paid freight costs of $1,100. | ||
6 | Xtra returned $5,900 of the merchandise purchased from Pina Colada on January 2, because it was not needed. The cost of the merchandise returned was $3,304, and it was restored to inventory. | ||
11 | Pina Colada received the balance due from Xtra. |
Journal entry
Date | account and explanation | Debit | Credit |
Jan 2 | Account receivable | 45900 | |
Sales revenue | 45900 | ||
(To record sales) | |||
Cost of goods sold | 25704 | ||
Merchandise inventory | 25704 | ||
(To record cost of goods sold | |||
Jan 5 | Freight out | 1100 | |
Cash | 1100 | ||
(To record freight paid) | |||
Jan 6 | Sales return and allowance | 5800 | |
Account receivable | 5800 | ||
(To record sales return) | |||
Merchandise inventory | 3304 | ||
Cost of goods sold | 3304 | ||
(To record cost of goods returned) | |||
Jan 11 | Cash (40000*98%) | 39200 | |
Sales discount | 800 | ||
Account receivable (45900-5900) | 40000 | ||
(To record amount received) |