Question

Mayfair Company completed the following transactions and uses a perpetual Inventory system. June 4 Sold $800 of merchandise on credit (that had cost $500) to Natara Morris, terms n/15. June 5 Sold $9,000 of merchandise (that had cost $5,400) to customers who used their Zisa cards. Bisa charges a 38 fee. June 6 Sold $6,000 of merchandise (that had cost $3,600) to customers who used their Access cards. Access charges a 21 fee. June 8 sold $5,000 of merchandise (that had cont $2,900) to customers who used their Access cards. Access charges a 11 fee. June 13 Wrote off the account of Abigail Mekee against the Allowance for Doubtful Accounts. The $600 balance in McKee's account was from a credit sale last year. June 18 Received Morris's check in full payment for the June 4 purchase. Prepare journal entries to record the preceding transactions and event

Answer 1

The journal entries for the transactions and events are listed, along with the calculations for the merchandise balance and current account balance.

Step-by-step explanation:

The journal entries for the transactions and events are as follows:

1. June 4 - Debit Accounts Receivable $800, Credit Sales Revenue $800
2. June 4 - Debit Cost of Goods Sold $500, Credit Inventory $500
3. June 5 - Debit Accounts Receivable $9,000, Credit Sales Revenue $9,000
4. June 5 - Debit Cost of Goods Sold $5,400, Credit Inventory $5,400
5. June 5 - Debit Bisa Fees Expense $38, Credit Sales Revenue $38
6. June 6 - Debit Accounts Receivable $6,000, Credit Sales Revenue $6,000
7. June 6 - Debit Cost of Goods Sold $3,600, Credit Inventory $3,600
8. June 6 - Debit Access Fees Expense $21, Credit Sales Revenue $21
9. June 8 - Debit Accounts Receivable $5,000, Credit Sales Revenue $5,000
10. June 8 - Debit Cost of Goods Sold $2,900, Credit Inventory $2,900
11. June 8 - Debit Access Fees Expense $11, Credit Sales Revenue $11
12. June 13 - Debit Allowance for Doubtful Accounts $600, Credit Abigail McKee's Accounts Receivable $600
13. June 18 - Debit Cash $800, Credit Accounts Receivable $800

The merchandise balance can be calculated by summing the cost of goods sold values for all transactions, which is $12,400 ($500 + $5,400 + $3,600 + $2,900).

The current account balance can be calculated by subtracting the total credit sales revenue from the total debit accounts receivable, which is $9,000 ($800 + $9,000 + $6,000 + $5,000 - $800).