Question

An inexperienced accountant for Huang Company made the following errors in recording merchandising transactions. A $195...

An inexperienced accountant for Huang Company made the following errors in recording merchandising transactions.

A $195 refund to a customer for faulty merchandise was debited to Sales Revenue $195 and credited to Cash $195.2.A $180 credit purchase of supplies was debited to Inventory $180 and credited to Cash $180.3.A $215 sales discount was debited to Sales Revenue.4.A cash payment of $20 for freight on merchandise purchases was debited to Freight-Out $200 and credited to Cash $200.

Homework Answers

Answer #1
Answer
Entry Made in the books:
1)A $195 refund to a customer for faulty merchandise was debited to Sales Revenue $195 and credited to Cash $195.
Corrected Entry is done as below,
Answer = Debited to Sales return for $ 195 and credited to Cash for $ 195
2.A $180 credit purchase of supplies was debited to Inventory $180 and credited to Cash $180.
Corrected Entry,
Answer = $180 credit purchase of supplies was debited to Inventory $180 and credited to Supplier(Account payable).
3.A $215 sales discount was debited to Sales Revenue.
Answer = Sales Discount of $ 215 will be debited to Sales Discount account
4) A cash payment of $20 for freight on merchandise purchases was debited to Freight-Out $200 and credited to Cash $200.
Answer = Freight payment against merchandise purhcase was debited to Freight - In with $ 200 and credited to Cash $ 200
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