Answer:
A. Books of Pais Company
June 10
Dr Merchandise inventory $9,000
Cr Accounts payable $9,000
June 11
Dr Merchandise inventory $400
Cr Cash $400
June 12
Dr Accounts payable $600
Cr Merchandise inventory $600
On June 19
Dr Account payable 8,400
Cr Cash 8,148
Cr Merchandise inventory 252
B. Books of McGiver Company
June 10
Dr Accounts receivable $9,000
Cr Sales $9,000
Dr Cost of Goods Sold $5,000
Cr Merchandise inventory $5,000
On June 11
No entry
On June 12
Dr Sales returns & allowances $600
Cr Accounts receivable $600
Dr Merchandise inventory $310
Cr Cost of Goods Sold $310
On June 19
Dr Cash 8,148
Dr Sales discounts 252
Cr Accounts receivable 8,400
Step-by-step explanation:
A. Preparation of the entries on the books of Pais Company.
June 10
Dr Merchandise inventory $9,000
Cr Accounts payable $9,000
June 11
Dr Merchandise inventory $400
Cr Cash $400
June 12
Dr Accounts payable $600
Cr Merchandise inventory $600
On June 19
Dr Account payable 8,400
($9,000 - $600)
Cr Cash 8,148
(8,400 x 97%)
Cr Merchandise inventory 252
(8,400 x 3%)
B. Preparation of the entries on the books of McGiver Company
June 10
Dr Accounts receivable $9,000
Cr Sales $9,000
Dr Cost of Goods Sold $5,000
Cr Merchandise inventory $5,000
On June 11
No entry is needed in McGiver Company books
On June 12
Dr Sales returns & allowances $600
Cr Accounts receivable$600
Dr Merchandise inventory$310
Cr Cost of Goods Sold$310
On June 19
Dr Cash 8,148
(8,400 x 97%)
Dr Sales discounts 252
(8,400 x 3%)
Cr Accounts receivable 8,400
(8,148+252)