Question

1,Sales were $72,000. Cost of merchandise sold was 55% of its sales price. 70% of the sales were on open account. [Note: Record the complete entry for the sales first and the complete entry for the expenses second]

2,Transaction 2
The company quickly acquired $42,000 in inventory, 70% of which was paid for in cash. The rest was acquired on open accounts that were payable after 30 days.

Answer 1

Journal entries are as prepared below:

	Date	Particulars	L.F	Amount ($)	Amount ($)
1	20XX
		Cash		21,600
		Account Receivable (70% of 72,000)		50,400
		Sales			72,000
		(To Sales recorded)
		Cost of goods sold (72,000*55%)		39,600
		Merchandise Inventory			39,600
		(For cost of goods sold recorded)
	Date	Particulars	L.F	Amount ($)	Amount ($)
2	20XX
		Merchandise Inventory		42,000
		Accounts Payable (42,000*.3)			12,600
		Cash			29,400
		(For inventory acquired)
		Account Payable		12,600
		Cash			12,600
		(To paid after 30 days)