Question

A company has the following transactions during March:  

March   3 Purchases inventory on account for $3,500, terms 2/10, n/30.
March   5 Pays freight costs of $200 on inventory purchased on March 3.
March   6 Returns inventory with a cost of $500.
March 12 Pays the full amount due on March 3 purchase.
March 29 Sells all inventory purchased on March 3 (less those returned on March 6) for $5,000 on account.

Record all transactions, assuming the company uses a perpetual inventory system. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.)

Answer 1

Date	Accounts Titles & Explanation	Debit ($)	Credit ($)
March   3	Inventory	3,500
	Accounts Payable		3,500
	[To record purchase of inventory on account]
March   5	Inventory	200
	Cash		200
	[To record freight for inventory purchased]
March   6	Accounts Payable	500
	Inventory		500
	[To record return of inventory]
March 12	Accounts Payable [$3,500 - $500]	3,000
	Inventory [$3,000 * 2 %]	60
	Cash		2,940
	[To record payment made & avail the discount]
March 29	Accounts Receivable	5,000
	Inventory		5,000
	[To record sale of inventry on account]
March 29	Cost of goods sold [$3,500 + $200 - $500 - $60]	3,140
	Inventory		3,140
	[To record transfer of sold inventry value to cogs account]