Merchandise Transactions

Problem 4  Merchandise Transactions Elite Enterprises entered into the transactions listed below:

 

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1    Purchased merchandise from Celeste Co. on credit for $14,000, terms 2/10, n/30.

 

6    Purchased $12,400 of merchandise from Ace Co. on credit (no discount offered).

 

7    Paid for half of the goods purchased from Celeste (on July 1). Received the appropriate discount.

 

  • Returned $2,000 of the items purchased on July 6.

 

  • Paid freight charges of $240 on the items purchased July 6.

 

12    Sold merchandise on credit to Light Co. for $8,700. The merchandise had an inventory cost of $6,400.

 

14    Of the merchandise sold to Light Co. on July 12, $800 of it was returned. The items had cost the store $500.

 

  • Received payment from Light Co. for the balance owed.

 

  • Paid Ace Co. the balance owed.

 

22     Paid Celeste the balance owed (purchased on July 1), receiving no discount.

 

 

Required: Don’t forget returns when you pay balances!

  • Prepare all journal entries for July for Elite Enterprises, assuming the use of the perpetual inventory system.
  • Prepare all journal entries for July for Elite Enterprises, assuming the use of the periodic inventory system.

 

 

 

 

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