Journalize the following purchase transactions for ABC Swimming Pool Supply Company using the periodic inventory system. Explanations are not required
May 2 Purchased $5,280 of merchandise inventory on account under terms 3/10, n/30 and FOB shipping point.
May 6 Returned $675 of defective merchandise purchased on May 2.
May 8 Paid freight bill of $120 on May 2 purchase.
May 12 Paid amount owed on credit purchase on May 2.
What will be an ideal response
Date Accounts and Explanation Debit Credit
May 2 Purchases 5,280
Accounts Payable 5,280
May 6 Accounts Payable 675
Purchases Returns and Allowance 675
May 8 Freight-In 120
Cash 120
May 12 Accounts Payable ($5,280 - $675 ) 4,605
Cash ($4,605 - $138.15 ) 4,466.85
Purchase Discount ($4,605 x .03 ) 138.15
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