During January of Year 1, Sports World experienced the following business events. The company uses the perpetual inventory system. 1) Jan 3. Purchased $10,000 of merchandise from a supplier, Apex Athletic Shoes. The terms of the purchase: 2/10, n/30 and FOB shipping point.2) Jan 5. Paid $275 cash for freight to trucking company to have goods shipped from Apex.3) Jan 7:(a) Sold merchandise for $1,500 to a customer on account. (b) The merchandise had cost Sports World $900.4) Jan 10. Returned $1,100 of defective shoes to Apex. 5) Jan. 11: (a) Recorded the cash discount on the goods purchased in Event 1(b) Paid amount due on account to Apex for merchandise purchased on Jan. 3.6) Jan. 12: (a) Accepted a return of $375 of the goods sold on Jan. 7. (b) The cost of these goods was
$225.Required:Record the events in general journal format.
What will be an ideal response?
| 1) | Merchandise inventory | 10,000 | ? |
| ? | Accounts payable | ? | 10,000 |
| 2) | Merchandise inventory | 225 | ? |
| ? | Cash | ? | 225 |
| 3) | Accounts receivable | 1,500 | ? |
| ? | Sales revenue | ? | 1,500 |
| ? | Cost of goods sold | 900 | ? |
| ? | Merchandise inventory | ? | 900 |
| 4) | Accounts payable | 1,100 | ? |
| ? | Merchandise inventory | ? | 1,100 |
| 5) | Accounts payable | 178 | ? |
| ? | Merchandise inventory | ? | 178 |
| ? | Accounts payable | 8,722 | ? |
| ? | Cash | ? | 8,722 |
| 6) | Sales revenue | 375 | ? |
| ? | Accounts receivable | ? | 375 |
| ? | Inventory | 225 | ? |
| ? | Cost of goods sold | ? | 225 |
Cash payment = Balance in accounts payable of ($10,000 ? $1,100 ? $178) = $8,722
Business
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