Kelso Company Purchased Merchandise on Account from Office Suppliers for $86,000

question 132

Essay

Kelso Company purchased merchandise on account from Office Suppliers for $86,000, with terms of 2/10, n/30. During the discount period, Kelso returned some merchandise and paid $78,400 as payment in full. Kelso uses a perpetual inventory system. Prepare the journal entries that Kelso Company made to record:
(1) the purchase of merchandise.
(2) the return of merchandise.
(3) the payment on account.
(b) Noble Company sold merchandise to Fugate Company on account for $73,000 with credit terms of ?/10, n/30. The cost of the merchandise sold was $43,800. During the discount period, Fugate Company returned $3,000 of merchandise and paid its account in full (minus the discount) by remitting $69,300 in cash. Both companies use a perpetual inventory system. Prepare the journal entries that Noble Company made to record:
(1) the sale of merchandise.
(2) the return of merchandise.
(3) the collection on account.

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Definitions:

Gender Identity

A person’s inner concept of themselves in relation to the ideas of being male, female, both, or neither.

Love And Belongingness

A fundamental human need for affectionate relationships and a sense of community and acceptance.

Physiological Needs

Basic physical requirements for human survival, such as food, water, shelter, and sleep, considered foundational in Maslow's hierarchy of needs.

Safety Needs

A level in Maslow's hierarchy of needs that entails security, stability, and freedom from fear.