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    Transactions for CSI Systems

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    Journalize the following merchandising transactions for CSI Systems assuming it uses (a) a periodic inventory system and (b) a perpetual inventory system.

    1. On November 1, CSI Systems purchases merchandise for $1,400
    on credit with terms of 2_5, n_30, FOB shipping point; invoice dated
    November 1.

    2. On November 5, CSI Systems pays cash for the November 1 purchase.

    3. On November 7, CSI Systems discovers and returns $100 of defective
    merchandise purchased on November 1 for a cash refund.

    4. On November 10, CSI Systems pays $80 cash for transportation
    costs with the November 1 purchase.

    5. On November 13, CSI Systems sells merchandise for $1,500
    on credit. The cost of the merchandise is $750.

    6. On November 16, the customer returns merchandise from the
    November 13 transaction. The returned items sell for $200 and cost $100.

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    Solution Preview

    Journalize the following merchandising transactions for CSI Systems assuming it uses (a) a periodic inventory system and (b) a perpetual inventory system.

    (a) a periodic inventory system

    1. On November 1, CSI Systems purchases merchandise for $1,400
    on credit with terms of 2_5, n_30, FOB shipping point; invoice dated
    November 1.

    Nov. 1 Purchases 1,400
    Accounts Payable 1,400

    2. On November 5, CSI Systems pays cash for the November 1 purchase.

    Nov. 5 Accounts Payable 1,400
    Cash 1,400

    3. On November 7, CSI Systems discovers and returns $100 of ...

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