Reid Supply uses a perpetual inventory system. Their beginning inventory included 15 backpacks at a cost of $20 each. During September, the following transactions occurred. Their chart of accounts used is provided below. Prepare the correct journal entries for the monthly transactions of the company.
| Chart of Accounts |
|
Transactions |
| 100 |
Cash |
|
4-Sep |
Purchased 70 backpacks at $20 each from Hunter with terms 2/10, n/30 and FOB Destination |
| 105 |
Accounts Receivable |
|
5-Sep |
The appropriate party for the Sept 4th purchase pays $50 for freight costs |
| 110 |
Supplies |
|
6-Sep |
Returned 5 backpacks from the Sept 4th purchase and received a credit of $100 |
| 115 |
Inventory |
|
9-Sep |
Sold 45 backpacks for $35 each to Oliver Books with terms 2/10, n/30 and FOB Destination |
| 200 |
Accounts Payable |
|
10-Sep |
The appropriate party for the Sept 9th sale pays $40 for freight costs |
| 300 |
Common Stock |
|
12-Sep |
Oliver Books returned 5 backpacks from the Sept 9th sale |
| 400 |
Sales Revenue |
|
13-Sep |
Purchased 50 backpacks at $20 each from Swann with terms 3/15, n/30 and FOB Shipping Point |
| 405 |
Sales Returns & Allowances |
|
14-Sep |
The appropriate party for the Sept 13th purchase pays $45 for freight costs |
| 410 |
Sales Discounts |
|
14-Sep |
Paid Hunter in full, less discount for outstanding balance |
| 500 |
Cost of Goods Sold |
|
17-Sep |
Received payment in full from Oliver Books, less discount for outstanding balance |
| 505 |
Freight Out |
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| 510 |
Rent Expense |
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| Date |
Account Titles |
Ref. |
Debit |
Credit |
| 4-Sep |
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| 5-Sep |
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| 6-Sep |
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| 9-Sep |
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| 10-Sep |
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| 12-Sep |
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| 13-Sep |
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| 14-Sep |
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| 14-Sep |
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| 17-Sep |
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