P5-1A Journalize purchase and sales transactions under a perpetual inventory system

Kern's Book Warehouse distributes hardcover books to retail stores and extend credit terms of 2/10, n/30 t
At the end of May, Kern's inventory consisted of books purchased for $1,800. During June, the following m
occurred.

June 1 Purchased books on account for $1,600 from Binsfield Publishers, FOB destination, terms 2/1
The appropriate party also made a cash payment of $50 for the freight on this date.
3 Sold books on account to Reading Rainbow for $2,500. The cost of the books sold was $1,44
6 Received $100 credit for books returned to Binsfield Publishers.
9 Paid Binsfield Publishers in full, less discount.
15 Received payment in full from Reading Rainbow.
17 Sold books on account to Rapp Books for $1,800. The cost of the books sold was $1,080.
20 Purchased books on account for $1,800 from McGinn Publishers, FOB destination, terms 2/15
The appropriate party also made a cash payment of $60 for the freight on this date.
24 Received payment in full from Rapp Books.
26 Paid McGinn Publishers in full, less discount.
28 Sold books on account to Baeton Bookstore for $1,600. The cost of the books sold was $970
30 Granted Baeton Bookstore $120 credit for books returned costing $72.

Kern's Book Warehouse's chart of accounts includes the following: No.101 Cash, No.112, Accounts Recei
No.120 Inventory, No. 201 Accounts Payable, No. 401 Sales Revenue, No.412 Sales Returns and Allowan
Sales Discounts, and No. 505 Cost of Goods Sold.

Instructions
Journalize the transactions for the month of June for Kern's Book Warehouse using a perpetual inventory s

Kern's Book Warehouse

General Entries
(Perpetual Inventory System)
Date Account Titles & Explanations Ref Debit
June 01 Inventory 120 1,600
Accounts Payable 201
(To record purchased Merchandising Inventory
on account, FOB destination, terms 2/10, n/30)
June 03 Account Receivable 112 2,500
Sales 401
(To record Merchandising Inventory sold on
account, terms 2/10, n/30)
Cost of Goods Sold 505 1,440
Inventory 120
(To record cost of Merchandising Inventory sold)
June 06 Accounts Payable 201 100
 Inventory 120
(To record Merchandising Inventory returned to
Binsfield Publishers)
June 09 Accounts Payable(1.600 - 100 = 1.500) 201 1,500
Inventory(1.500 x 2% = 30) 120
Cash(1.500 - 30 = 1.470) 101
(To record payment within discount period)
June 15 Cash 101 2,500
Accounts Receivable 112
(To record Received cash from Reading Rainbow)
June 17 Account Receivable 112 1,800
Sales 401
(To record Merchandising Inventory sold on
account, terms 2/10, n/30)
Cost of Goods Sold 505 1,080
Inventory 120
(To record cost of Merchandising Inventory sold)
June 20 Inventory 120 1,800
Accounts Payable 201
(To record purchased Merchandising Inventory
on account, FOB destination, terms 2/10, n/30)

June 24 Sales Discount(1.800 x 2% = 36) 414 36

Cash(1.800 - 36 = 1.764) 101 1,764
Accounts Receivable 112
(To record Received cash from Rapp Books)
June 26 Accounts Payable 201 1,800
Inventory(1.800 x 2% = 36) 120
Cash(1.800 - 36 = 1.764) 101
(To record payment within discount period)
June 28 Account Receivable 112 1,600
Sales 401
(To record Merchandising Inventory sold on
account, terms 2/10, n/30)

Cost of Goods Sold 505 970

Inventory 120
(To record cost of Merchandising Inventory sold)
June 30 Sales Returns and Allowances 412 120
Accounts Receivable 112
(To record credit Granted to book store for
returning books)

Inventory 120 72
Cost of Goods Sold 505
(To record cost of Goods Returned)
d credit terms of 2/10, n/30 to all of its customers.
During June, the following merchandising transactions

FOB destination, terms 2/10, n/30.

eight on this date.
of the books sold was $1,440.

books sold was $1,080.

FOB destination, terms 2/15,n/30.
eight on this date.

of the books sold was $970.

sh, No.112, Accounts Receivable,

Sales Returns and Allowances, No. 414

using a perpetual inventory system.

Credit

1,600

2,500

1,440
 100

30
1,470

2,500

1,800

1,080

1,800

1,800

36
1,764

1,600

970

120

72