Question

Mayfair Co. completed the following transactions and uses a perpetual inventory system in June.

4 Sold $650 of merchandise on credit (that had cost $400) to Natara Morris.
5 Sold $6,900 of merchandise (that had cost $4,200) to customers who used their Zisa cards.
6 Sold $5,850 of merchandise (that had cost $3,800) to customers who used their Access cards.
8 Sold $4,350 of merchandise (that had cost $2,900) to customers who used their Access cards.
13 Wrote off the account of Abigail McKee against the Allowance for Doubtful Accounts. The $429 balance in McKee’s account stemmed from a credit sale in October of last year.
18 Received Morris’s check in full payment for the purchase of June 4.

Prepare journal entries to record the preceding transactions and events.

Answer 1

Answer:

Journal Entries

Explanation:

The Journal entry is shown below:-

June 4

Accounts receivable Dr,           $650

         To Sales                                    $550

(Being sale of merchandise on credit is recorded)

June 4

Cost of goods sold Dr,               $400

          To Merchandise inventory       $400

(Being cost of goods sold is recorded)

June 5

Cash Dr,                                    $6,693

Credit card expenses               $207

(6,900 × 3%)

          To Sales                                  $6,900

(Being sale of merchandise is recorded)

June 5

Cost of goods sold Dr,               $4,200

          To Merchandise inventory       $4,200

(Being cost of goods sold is recorded)

June 6

Accounts receivable - access Dr,  $5,733

Credit card expenses Dr,                $117

($5,850 × 2%)

                 To Sales                             $5,850

June 6

Cost of goods sold Dr,               $3,800

          To Merchandise inventory       $3,800

(Being cost of goods sold is recorded)

June 8

Accounts receivable - access Dr,  $4,263

Credit card expenses Dr,                $87

($4,350 × 2%)

                 To Sales                             $4,350

(Being sale of merchandise on credit is recorded)

June 8

Cost of goods sold Dr,               $2,900

          To Merchandise inventory       $2,900

(Being cost of goods sold is recorded)

June 13

Allowance for doubtful accounts Dr,  $429

           To Accounts receivable                $429

(Being written off amount is recorded)

June 18

Cash Dr,                                                $650

         To Accounts receivable                    $650

(Being payment for the purchase is recorded)