Problem
Using the periodic inventory system, prepare general journal entries for the following selected transactions of Harlow Ltd in July. Ignore GST.
5 July Purchased inventory from BestHouse in cash for $13 200 and on credit for $12 000, terms 3/10, n/30
10 July Sold inventory to Crane Ltd for $51 000 on account, terms 2/10, n/30
11 July Returned inventory for credit that was previously purchased from BestHouse for $1 500
12 July Made payment to BestHouse
14 July Crane Ltd returned faulty goods for $800 credit
17 July Purchased two computers for the new administrators and paid $4 510 cash
Task:
A. Prepare the journal entries to record each of the above transactions in the accounting records of Harlow Ltd.
B. Prepare the journal to record the transaction on 17 July, assuming that $4 510 is GST inclusive.