Question

Swifty Warehouse distributes suitcases to retail stores and extends credit terms of n/30 to all of its customers. Swifty Warehouse uses a perpetual inventory system the earnings approach. At the end of June its inventory consisted of 35 suitcases purchased at $30 each. During the month of July, the following merchandising transactions occurred:

July 1		Purchased 50 suitcases on account for $30 each from Trunk Manufacturers, terms n/30, FOB destination.
2		The correct company paid $135 freight on the July 1 purchase.
4		Received $150 credit for five suitcases returned to Trunk Manufacturers because they were damaged.
10		Sold 45 suitcases that cost $30 each to Satchel World for $70 each on account.
12		Issued a $350 credit for five suitcases returned by Satchel World because they were the wrong colour. The suitcases were returned to inventory.
15		Purchased 60 additional suitcases from Trunk Manufacturers for $27.50 each, terms n/30, FOB shipping point.
18		Paid $150 freight to AA Trucking Company for merchandise purchased from Trunk Manufacturers.
21		Sold 60 suitcases that cost $30 each to Fly-By-Night for $70 each on account.
23		Gave Fly-By-Night a $140 credit for two returned suitcases. The suitcases had been damaged and were sent to the recyclers.
30		Paid Trunk Manufacturers for the July 1 purchase.
31		Received balance owing from Satchel World.

Answer 1

Onli journal entry no T- account no merchandise inventory STUDY NOTE

FREIGHT EXPENSES ARE FOR MERCHANDISE INVENTORY SO WE SHOULD DEBITED TO MERCHANDISE INVENTORY ACCOUNT

FURTHER WE CAN USE MERCHANDISE INVENTORY IN RESPECT OF FREIGHT EXPENSES FOR JOURNAL ENTRY .