Question

Record the following transactions as general journal entries. Use the gross-price method.

Aug. 6 Purchased $830 of merchandise on account from Johnston Co. Credit terms 2/10, n/30.
8 Bought an $18,000 truck from Pillner Co., paying $3,000 down; balance on account.
13 Purchased $2,611 of merchandise for cash from Pillner and Co.
15 Paid for the August 6 purchase of merchandise from Johnston Co.
17 Purchased $1,743 of merchandise from Luis Co. Credit terms 2/10, n/30.

Answer 1

General Journal Entries:

Aug. 6 Debit Inventory $830

Credit Accounts Payable (Johnston Co.) $830

To record the purchase of merchandise; Credit terms 2/10, n/30.

Aug. 8 Debit Truck $18,000

Credit Accounts Payable (Pillner Co.) $15,000

Credit Cash $3,000

To record the purchase of truck.

Aug. 13 Debit Inventory $2,611

Credit Cash $2,611

To record the purchase of inventory for cash.

Aug. 15 Debit Accounts Payable (Johnston Co.) $830

Credit Cash $813

Credit Cash Discounts $17

To record the payment on account, including discounts.

Aug. 17 Debit Inventory $1,743

Credit Accounts Payable (Luis Co.) $1,743

To record the purchase of goods; Credit terms 2/10, n/30.

Step-by-step explanation:

a) Data and Analysis:

Aug. 6 Inventory $830 Accounts Payable (Johnston Co.) $830

Credit terms 2/10, n/30.

Aug. 8 Truck $18,000 Accounts Payable (Pillner Co.) $15,000 Cash $3,000

Aug. 13 Inventory $2,611 Cash $2,611

Aug. 15 Accounts Payable (Johnston Co.) $830 Cash $813 Cash Discounts $17

Aug. 17 Inventory $1,743 Accounts Payable (Luis Co.) $1,743

Credit terms 2/10, n/30.