Question

On June 10, Blossom Company purchased $7,100 of merchandise from Sunland Company, terms 4/10, n/30. Blossom Company pays the freight costs of $350 on June 11. Goods totaling $600 are returned to Sunland Company for credit on June 12. On June 19, Blossom Company pays Sunland Company in full, less the purchase discount. Both companies use a perpetual inventory system.

Prepare separate entries for each transaction on the books of Blossom Company. (If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts. Credit account titles are automatically indented when amount is entered. Do not indent manually. Record journal entries in the order presented in the problem.)

Answer 1

Blossom Company made several transactions with Sunland Company, including a purchase, payment of freight costs, return of goods, and payment in full. The journal entries for each transaction are provided.

Step-by-step explanation:

On June 10, Blossom Company purchased $7,100 of merchandise from Sunland Company, terms 4/10, n/30. The journal entry for this transaction would be:

• Debit Accounts Payable: $7,100
• Credit Inventory: $7,100

On June 11, Blossom Company paid $350 as freight costs. The journal entry for this transaction would be:

• Debit Freight-In: $350
• Credit Cash: $350

On June 12, Blossom Company returned $600 worth of goods to Sunland Company. The journal entry for this transaction would be:

• Debit Accounts Payable: $600
• Credit Inventory: $600

On June 19, Blossom Company paid the remaining amount to Sunland Company, less the discount. The journal entry for this transaction would be:

• Debit Accounts Payable: $6,500
• Credit Cash: $6,500
• Debit Purchase Discount: $100
• Credit Accounts Payable: $100

Answer 2

June 10

Dr Inventory $7,100

Cr Accounts payable $7,100

June 11

Dr Inventory $350

Cr Cash $350

June 12

Dr Accounts payable $600

Cr Inventory $600

June 19

Dr Account payable $6,500

Cr Cash $6,240

Cr Inventory $260

Step-by-step explanation:

Preparation of a separate journal entries for each transaction on the books of Blossom Company.

Books of Blossom Company

June 10

Dr Inventory $7,100

Cr Accounts payable $7,100

June 11

Dr Inventory $350

Cr Cash $350

June 12

Dr Accounts payable $600

Cr Inventory $600

June 19

Dr Account payable $6,500

($7,100-$600)

Cr Cash $6,240

($6,500-$260)

Cr Inventory $260

(4%*$6,500)