Question

Atkinson Building Supplies had the following transactions during August. Atkinson uses a perpetual inventory system. Using the accounts listed below and the journal paper provided, journalize the transactions in proper form. Indicate no entry if appropriate. Omit explanations.

Aug. 6 Stockholders invested $15,000 cash in the business in exchange for 1,000 shares of $10 par value common stock.

Aug. 8 Purchased merchandise on credit from Mitchell Company, terms n/30, FOB shipping point, $3,600.

Aug. 9 Received utility bill for $200 to be paid at a later date.

Aug. 10 Returned damaged merchandise received from Mitchell Company on August 8 for credit, $400.

Aug. 12 Paid the balance due on the equipment purchased on August 4.

Aug. 14 Paid in full the amount due to Mitchell Company for the purchase of August 8.

Aug. 15 Sold merchandise on credit to Benner Corporation, terms 2/10, n/30, $2,400 (cost of $940)

Answer 1

Journal entries

Date	General Journal	Debit	Credit
Aug 6	Cash	15000
	Common Stock		10000
	Paid in capital in excess of par-Common Stock		5000
Aug 8	Merchandise inventory	3600
	Account payable		3600
Aug 9	Utilities expense	200
	Account payable		200
Aug 10	Account payable	400
	Merchandise inventory		400
Aug 12	Account payable (3600-400)	3200
	Cash		3200
Aug 14	Account payable
	Cash
Aug 15	Account receivable	2400
	Sales revenue		2400
	Cost of goods sold	940
	Merchandise inventory		940

Note : For August 12 amount we should see journal entry of August 4