Ex 5.
5
Summit Wholesale Inc. completed the following merchandising transactions in the
month of July. At the beginning of July, the ledger of Summit showed Cash of $12,000 and
Owner’s Capital of $12,000.
Transactions
1July 3 – Purchased merchandise on account from Rockwell Supply Co. for $8,200,
terms 2/10, n/30.
2July 6 – Sold merchandise on account for $7,100, FOB destination, terms 1/10, n/30.
The cost of the merchandise sold was $4,200.
3July 7 – Paid $260 freight on the July 6 sale.
4July 9 – Received credit from Rockwell Supply Co. for merchandise returned, $600.
5July 13 – Paid Rockwell Supply Co. in full, less discount.
6July 15 – Received collections in full, less discounts, from customers billed on July 6.
7July 17 – Purchased merchandise for cash $4,600.
8July 20 – Received a refund from a supplier for returned goods on the cash purchase of
July 17, $700.
9July 22 – Purchased merchandise from Everett Distributors for $5,200, FOB
destination, terms 2/10, n/30.
10July 24 – Sold merchandise for cash $8,100. The cost of the merchandise sold was
$4,600.
11July 27 – Purchased merchandise for cash $3,200.
12July 28 – Paid Everett Distributors in full, less discount.
13July 30 – Made refunds to cash customers for defective merchandise $110. The
returned merchandise had a fair value of $40.
Summit Wholesale Inc.’s chart of accounts includes the following:
Cash, Accounts Receivable, Inventory, Accounts Payable, Owner’s Capital, Sales Revenue, No.
412 Sales Returns and Allowances, Sales Discounts, Cost of Goods Sold, Freight-out, Dividends
Instructions
Journalize the transactions using a perpetual inventory system
Ex 5.6
Company: SmartTech Trading Co.
Product: Wireless Headphones
Period: March 2025
Transactions:
March 2
The company purchased 200 units of Wireless Headphones at $52 each. The
purchase was made on credit and is payable to the supplier later.
March 5:
The company sold 150 units to a customer at $80 each, earning $12,000 in cash.
The cost of the merchandise sold was $40 each
March 8:
The company bought 100 units at $55 each. This purchase was paid in cash at the
time of transaction.
March 10:
The company sold 100 units at a selling price of $82 each. The sale was made on
credit, and the customer will pay later. The cost of the merchandise sold was $42 each
March 12
The customer from March 10 returned 10 units in good condition. (Sell price is
$82 each and fair value is $42 each)
The company refunded in cash and restocked the inventory at the original cost
March 15
The company purchased 150 units at $56 each. The payment will be made to the
supplier at a later date.
March 18:
The company sold 200 units at $85 each. The sale was made on credit. The cost of
the merchandise sold was $42 each
March 20:
The company purchased 50 units at $58 each. The full amount was paid in cash.
March 22
The company sold 100 units at $85 each, generating $8,500 in cash. The cost of the
merchandise sold was $42 each
March 25:
The company sold 50 units at $87 each. The sale was made on credit and the
customer will pay later. The cost of the merchandise sold was $43 each
Journalize the transactions using a perpetual inventory system