Question

May 8	Toys and More purchased $113,300 worth of MegoBlock toys on account with credit terms of 2/10, n/60.
May 12	Toys and More returned $11,250 of the merchandise to MegoBlock due to damage during shipment.
May 15	Toys and More paid the amount due, less the return and discount.

1.	Journalize the purchase transactions. Explanations are not required.
2.	In the final​ analysis, how much did the inventory cost Toys and More​?

Answer 1

Ans1:

Date	General journal	Debit	Credit
May 8	Merchandise inventory	113,300
	Accounts payable		113,300

Date	General journal	Debit	Credit
May 12	Accounts payable	11,250
	Merchandise inventory		11,250

Date	General journal	Debit	Credit
May 15	Accounts payable	102,050
	Cash		100,009
	Merchandise inventory		2041

Amount of accounts payable on May 15= Initial balance-returns

=113,300-11,250= $102,050

Amount of MERCHANDISE INVENTORYon May 15= 102050*2%= $2041

Cash= 102050-2041= 100,009

Ans 2: The inventory costed Toys and More $100,009 which is obtained by deducting inventory return and discount from the total purchase of inventory. (113,300-11,250-2041)