The following selected transactions were completed by Amsterdam Supply Co., which sells office supplies primarily to wholesalers and occasionally to retail customers:

The following selected transactions were completed by Amsterdam Supply Co., which sells office supplies primarily to wholesalers and occasionally to retail customers:

Mar. 

  2. Sold merchandise on account to Equinox Co., $18,900, terms FOB destination, 1/10, n/30. The cost of the merchandise sold was $13,300.

  3. Sold merchandise for $11,350 plus 6% sales tax to retail cash customers. The cost of merchandise sold was $7,000.

  4. Sold merchandise on account to Empire Co., $55,400, terms FOB shipping point, n/eom. The cost of merchandise sold was $33,200.

  5. Sold merchandise for $30,000 plus 6% sales tax to retail customers who used MasterCard. The cost of merchandise sold was $19,400.

 12. Received check for amount due from Equinox Co. for sale on March 2.

 14. Sold merchandise to customers who used American Express cards, $13,700. The cost of merchandise sold was $8,350.

 16. Sold merchandise on account to Targhee Co., $27,500, terms FOB shipping point, 1/10, n/30. The cost of merchandise sold was $16,000.

  18. Issued credit memo for $4,800 to Targhee Co. for merchandise returned from sale on March 16. The cost of the merchandise returned was $2,900.

 19. Sold merchandise on account to Vista Co., $8,250, terms FOB shipping point, 2/10, n/30. Added $75 to the invoice for prepaid freight. The cost of merchandise sold was $5,000.

 26. Received check for amount due from Targhee Co. for sale on March 16 less credit memo of March 18.

 28. Received check for amount due from Vista Co. for sale of March 19.

 31. Received check for amount due from Empire Co. for sale of March 4.

 31. Paid Fleetwood Delivery Service $5,600 for delivery of merchandise in March to customers under shipping terms of FOB destination.

Apr.

  3. Paid City Bank $940 for service fees for handling MasterCard and American Express sales during March.

 15. Paid $6,544 to state sales tax division for taxes owed on sales.

Instructions

Journalize the entries to record the transactions of Amsterdam Supply Co.

Answer:

 Mar. 2 Accounts Receivable—Equinox Co. 18,711

Sales18,711

 [$18,900 – ($18,900 × 1%)] 

2 Cost of Merchandise Sold 13,300

Merchandise Inventory13,300

3 Cash12,031

Sales 11,350

Sales Tax Payable681

3 Cost of Merchandise Sold 7,000

Merchandise Inventory7,000

4 Accounts Receivable—Empire Co. 55,400

Sales55,400

4 Cost of Merchandise Sold 33,200

Merchandise Inventory33,200

5 Cash31,800

Sales 30,000

Sales Tax Payable1,800

5 Cost of Merchandise Sold 19,400

Merchandise Inventory19,400

12 Cash18,711

Accounts Receivable—Equinox Co. 18,711

14 Cash13,700

Sales 13,700

14 Cost of Merchandise Sold 8,350

Merchandise Inventory8,350

16 Accounts Receivable—Targhee Co. 27,225

Sales27,225

 [$27,500 – ($27,500 × 1%)] 

16 Cost of Merchandise Sold 16,000

Merchandise Inventory16,000

 Mar. 18 Customer Refunds Payable 4,752

Accounts Receivable—Targhee Co.4,752

[$4,800 – ($4,800 × 1%)]

18 Merchandise Inventory2,900

Estimated Returns Inventory 2,900

19 Accounts Receivable—Vista Co. 8,085

Sales8,085

[$8,250 – ($8,250 × 2%)]

19 Accounts Receivable—Vista Co. 75

Cash75

19 Cost of Merchandise Sold 5,000

Merchandise Inventory5,000

26 Cash ($27,225 – $4,752)22,473

Accounts Receivable—Targhee Co.22,473

28 Cash ($8,085 + $75)8,160

Accounts Receivable—Vista Co.8,160

31 Cash55,400

Accounts Receivable—Empire Co.55,400

31 Delivery Expense5,600

Cash5,600

 Apr. 3 Credit Card Expense940

Cash940

15 Sales Tax Payable6,544

Cash6,544