Information about "Journal Entries"
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Boggs Company sold merchandise to Wilsey Company on account for $73,000 with credit terms of ?/10, n/30. The cost of the merchandise sold was $43,800. During the discount period, Wilsey Company returned $3,000 of merchandise and paid its account in full (minus the discount) by remitting $69,300 in cash. Both companies use a perpetual inventory system. Prepare the journal entries that Boggs Company made to record:
(1) the sale of merchandise.
(2) the return of merchandise.
(3) the collection on account.
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Solution Summary
The solution explains how the prepare journal entries relating to (1) the sale of merchandise, (2) the return of merchandise and (3) the collection on account.
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(1) the sale of merchandise.
The entry for sale of merchandise is ( under perpertual method the cost of goods sold is recorded for each sale)
Accounts Receivable Dr 73,000
Sales Cr 73,000
(To record the sales)
Cost of goods ...
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