Question:
Purchased merchandise from Blue Company under the given terms: $3,700 price, invoice dated April 2, credit terms of 2/15, n/60, and FOB shipping point.
Paid $207 for shipping charges on the April 2 purchase.
Returned to Blue Company unacceptable merchandise that had an invoice price of $700.
Sent a check to Blue Company for the April 2 purchase, total of the discount and the returned merchandise.
Purchased merchandise from Fox Corp. under the given terms: $7,850 price, invoice dated April 18, credit terms of 2/10, n/30, and FOB destination.
After negotiations, gets from Fox a $2,198 allowance on the April 18 purchase.
Sent check to Fox paying for the April 18 purchase, Total of the discount and allowance.
Compute journal entries to record the above transactions for a retail store. Consider a perpetual inventor