Question

Purchase-Related Transactions Journalize entries for the following related transactions of Manville Heating & Air Company: a....

Purchase-Related Transactions

Journalize entries for the following related transactions of Manville Heating & Air Company:

a. Purchased $39,000 of merchandise from Wright Co. on account, terms 2/10, n/30.

b. Paid the amount owed on the invoice within the discount period.

c. Discovered that $7,800 of the merchandise purchased in (a) was defective and returned items, receiving credit.

d. Purchased $6,100 of merchandise from Wright Co. on account, terms n/30.

e. Received a refund from Wright Co. for return in (c) less the purchase in (d).

Homework Answers

Answer #1

a. Purchased $39,000 of merchandise from Wright Co. on account, terms 2/10, n/30.

a Purchase 38220
Account payable-Wright Co 38220

b. Paid the amount owed on the invoice within the discount period.

b Account payable-Wright Co (39000*98%) 38220
Cash 38220

c. Discovered that $7,800 of the merchandise purchased in (a) was defective and returned items, receiving credit.

c Account payable-Wright Co (7800*98%) 7644
Purchase return and allowance 7644

d. Purchased $6,100 of merchandise from Wright Co. on account, terms n/30.

d Purchase 6100
Account payable-Wright Co 6100

e. Received a refund from Wright Co. for return in (c) less the purchase in (d).

e Cash (7800-6100) 1700
Account payable-Wright Co 1700
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