Question

Q.1 Dill Co. records purchases at net amounts and uses periodic inventories. Prepare entries for the following:

June    11   Purchased merchandise on account, $5,000, terms 2/10, n/30.

           15   Returned part of June 11 purchase, $800, and received credit on account.

           30   Prepared the adjusting entry required for financial statements.

Answer 1

Date	Account Tittles and Explanations	Debit ($)	Credit ($)
June 11	Purchases A/c [$5,000 x (1 – 0.02)]	4,900
	To Accounts Payable A/c		4,900
	[Entry to record the Purchase of merchandise on account]
June 15	Accounts Payable A/c [$800 x (1 – 0.02)]	784
	To Purchase Returns A/c		784
	[To record the purchase return of $800]
June 30	Purchase Discount Lost A/c [($5,000 – 800) x 0.02]	84
	To Accounts Payable A/c		84
	[Adjusting entry required on June 30]