Question

Journalize the following inventory merchandise transactions for both Sampson and Batson, assuming that the both Sampson and Batson uses the perpetual inventory system. Refer to the Chart of Accounts for exact wording of account titles. Dec. 1 Sampson Co. sold merchandise to Batson Co. on account, $46,000, terms 2/15, net 45. The cost of the merchandise sold is $38,500. 6 The Batson Co. paid the invoice within the discount period.

Answer 1

Answer:

Explanation:

The journal entries are shown below:

In the books of Sampson Company

a. Accounts receivable A/c Dr $46,000

        To Sales revenue $46,000

(Being merchandise is sold on a credit basis)

b. Cost of goods sold A/c Dr $38,500

        To Merchandise inventory A/c $38,500

(Being cost of merchandise is recorded)

c. Cash A/c Dr $45,080

   Sales discount A/c $920                                        ($46000 x 2%)

            To Accounts receivable A/c $46,000

(Being cash is received is recorded)

In the books of Batson Company

a. Merchandise inventory A/c $46,000

         To Accounts payable A/c $46,000

(Being merchandise is purchased on credit basis)

b. No journal entry is required

c. Accounts payable A/c Dr $46,000

              To Merchandise inventory A/c $920                  ($46000 x 2%)

              To Cash A/c $45,080

(Being cash is paid is recorded)