Purchases and Sale Transactions:

During the month of April 2015, the Smith Company had the transactions:
April 1
Smith sold on account merchandise costing P75, 000 for P93, 750.
Terms: FOB destination; 2/10, n/30. Freight charges P1, 500.
Accounts Receivable
Sales

93, 750
93, 750
Accounts Receivable
Sales

93, 750
93, 750

Cost of sales
75, 000
Merchandise Inventory
75, 000
April 5

Smith purchased merchandise on account from Gold Supply, P243, 000.

Terms: FOB shipping point; 3/10, n/30. Paid freight charges amounting to P4, 000.

Purchases
Accounts Payable

243, 000
243, 000

Freight in
Cash

4, 000

April 7

4, 000
Merchandise Inventory
Accounts Payable

243, 000
243, 000

Merchandise Inventory
Cash

4, 000

Smith purchased merchandise on account from Gold Supply, P470, 000.

Terms: FOB destination; 3/10, n/30. Freight charges amounted to P7, 000.

Purchases
Accounts Payable

470, 000
470, 000

Merchandise Inventory
Accounts Payable
April 8

4, 000

470, 000
470, 000

Smith returned P18, 000 of merchandise to Gold Supply from April 5 purchase.

Accounts Payable
Purchase returns

18, 000
18, 000
Accounts Payable
18, 000
Merchandise Inventory
18, 000

April 9

Smith sold one half of the net purchases from April 5 for P135, 000.
Terms: FOB shipping point; 2/10, n/30. Freight charges prepaid amounted to P5, 000.

Accounts Receivable
Sales

135, 000
135, 000

Accounts Receivable
Cash

5, 000
5, 000

Accounts Receivable
Sales

135, 000
135, 000

Cost of sales
112, 500
Merchandise Inventory
112, 500
Accounts Receivable
Cash
April 10

5, 000
5, 000

Smith paid Gold Supply the amount due on the April 5 transaction.

Accounts Payable
Cash
Purchase Discount

225, 000
218, 250
6, 750
Accounts Payable
225, 000
Cash
218, 250
Merchandise Inventory
6, 750

April 11

Gold Supply paid transportation charges on the April 7 transaction.

Received payment from customers for sales on April 1.

Cash
Sales Discount
Accounts Receivable

91, 875
1, 875
93, 750
Cash
Sales Discount
Accounts Receivable

April 14

216, 000
216, 000
Merchandise Inventory
Accounts Payable

216, 000
216, 000

Received payment from customers for April 9 sales.

Cash
Sales Discount
Accounts Receivable

132, 300
2, 700
135, 000
Cash
Sales Discount
Accounts Receivable

April 25

93, 750

Smith purchased merchandise from Gold supply on account, P270, 000.

Terms: 20% trade discount; FOB shipping point; 3/10, n/30

Purchases
Accounts Payable

April 19

91, 875
1, 875

132, 300
2, 700
135, 000

Freight charges on the April 14 transaction amounted to P3, 000 and was paid by Gold Supply.

Freight in
Accounts Payable

3, 000
3, 000
Merchandise Inventory
Accounts Payable

3, 000
3, 000

April 26

Smith paid Gold Supply the amount due on April 14 transaction

Accounts Payable
Cash

219, 000
219, 000
Accounts Payable
Cash

April 28

219, 000
219, 000

Sold merchandise for P515, 000 on a cash basis. The merchandise cost P485, 000.
Terms: FOB destination.

Cash

515, 000
515, 000

Sales

Cash
Sales

515, 000
515, 000

Cost of Sales
485, 000
Merchandise Inventory
485, 000
April 29

Received returns from customers of merchandise costing P12, 250. Sales on April 28; selling
price P17, 500.

Sales returns
Cash

April 30

17, 500
17, 500
Sales returns
Cash

17, 500

Merchandise Inventory
Cost of Sales

12, 250

17, 500

12, 250

Paid freight charges for sale on April 28, P9, 700

Freight out
Cash

9, 700
9, 700
Freight out
Cash

9, 700
9, 700

Additional information:
1. Beginning inventory amounted to P115, 000.
Income Summary
115, 000
Merchandise Inventory
115, 000
2. Ending inventory per count amounted P410, 000.
Merchandise Inventory
Income Summary

410, 000
410, 000
Merchandise Inventory
Cost of Sales

Requirements:
1. Prepare journal entries.

44, 000
44, 000