Question

Information related to Riverbed Co. is presented below.

a. On April 5, purchased merchandise on account from Tamarisk Company for $36,000, terms 3/10, net/30, FOB shipping point.
b. On April 6, paid freight costs of $920 on merchandise purchased from Tamarisk.
c. On April 7, purchased equipment on account for $30,500.
d. On April 8, returned damaged merchandise to Tamarisk Company and was granted a $4,200 credit for returned merchandise.
e. On April 15, paid the amount due to Wilkes Company in full.

Required:
Prepare the journal entries to record these transactions on the books of Kerber Co. under a perpetual inventory system.

Answer 1

April 5

Debit : Merchandise $36,000

Credit : Accounts Payable - Tamarisk Company $36,000

April 6

Debit : Accounts Payable - Tamarisk Company $920

Credit : Cash $920

April 7

Debit : Equipment $30,500

Credit : Accounts Payable $30,500

April 8

Debit : Accounts Payable - Tamarisk Company $4,200

Credit : Merchandise $4,200

April 15

Debit : Accounts Payable - Tamarisk Company $30,880

Credit : Discount received $926.40

Credit : Cash $29,954

Step-by-step explanation:

Working for Journal on April 15

Balance = $36,000 - $920 - $4,200

= $30,880

Discount = $30,880 x 3%

= $926.40

Amount Paid = $30,880 - $926.40

= $29,954