Question

Information related to Whispering Winds Corp. is presented below.

1. On April 5, purchased merchandise on account from Martinez Company for $27,200, terms 2/10, net/30, FOB shipping point.
2. On April 6, paid freight costs of $900 on merchandise purchased from Martinez.
3. On April 7, purchased equipment on account for $29,100.
4. On April 8, returned $3,400 of merchandise to Martinez Company.
5. On April 15, paid the amount due to Martinez Company in full.
Prepare the journal entries to record these transactions on the books of Kerber Co. under a perpetual inventory system. (Credit account titles are automatically indented when amount is entered. Do not indent manually. Record journal entries in the order presented in the problem.)
No.
Date Account Titles and Explanation Debit Credit
1. April 5April 6April 7April 8April 15
2. April 5April 6April 7April 8April 15
3. April 5April 6April 7April 8April 15
4. April 5April 6April 7April 8April 15
5. April 5April 6April 7April 8April 15

Answer 1

April 5

Dr Inventory $27,200

Cr accounts payable $27,200

April 6

Dr Inventory $900

Cr Cash $900

April 7

Dr Equipment $29,100

Cr Accounts payable $29,100

April 8

Dr Accounts payable $3,400

Cr Inventory $3,400

April 15

Dr Accounts payable $23,800

Cr Cash $23,324

Cr Inventory $476

Step-by-step explanation:

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

April 5

Dr Inventory $27,200

Cr accounts payable $27,200

April 6

Dr Inventory $900

Cr Cash $900

April 7

Dr Equipment $29,100

Cr Accounts payable $29,100

April 8

Dr Accounts payable $3,400

Cr Inventory $3,400

April 15

Dr Accounts payable $23,800

($27,200-$3,400)

Cr Cash $23,324

($23,800-$476)

Cr Inventory $476

(2%*$23,800)