Q5-8TI
Question
Click Computers has the following transactions in July related to purchasing and sale of merchandise inventory.
July 1 Purchase of \(20,500 worth of computers on account, terms of 2/10, n/30.
3 Return of \)4,000 of the computers to the vendor.
9 Payment made on the account.
12 Sold computers on account for $8,000 to a customer, terms 3/15, n/30.
26 Received payment from customer on balance due.
Journalize the transactions for Click Computers assuming that the company uses the periodic inventory system.
Step-by-Step Solution
VerifiedThe total debit and credit of the journal are $56,760.
An inventory system that periodically updates the inventory transactions is termed a periodic inventory system. Under this system, a business entity updates its inventory accounts at the end of an accounting period and tracks its beginning and closing inventories.
Date | Accounts and Explanation | Debit ($) | Credit ($) |
July 1 | Purchases | 20,500 |
|
| Accounts payable |
| 20,500 |
| (To record the purchase of computers) |
|
|
July 3 | Accounts payable | 4,000 |
|
| Purchase return |
| 4,000 |
| (To record the return of goods) |
|
|
July 9 | Accounts payable | 16,500 |
|
| Cash |
| 16,170 |
| Purchase discount |
| 330 |
| (To record the payment within the discount period) |
|
|
July 12 | Accounts receivable | 8,000 |
|
| Sales revenue |
| 8,000 |
| (To record the sale of computers) |
|
|
July 26 | Cash | 7,760 |
|
| Sales discount | 240 |
|
| Accounts receivable |
| 8,000 |
| (Cash received within the discount period) |
|
|