Abe's Printing Supply Company Uses a Perpetual Inventory System

question 36

Essay

Abe's Printing Supply Company uses a perpetual inventory system.The company had the following transactions during August 2019:
Aug.5: Purchased $2,900 of merchandise on account.Freight and credit terms were FOB shipping point,3/15,n/60.
Aug.9: Paid transportation costs of $440 for the Aug.5 purchase.
Aug.10: Returned $600 of defective merchandise that had been purchased on Aug.5.
Aug.15: Paid for the merchandise purchased on Aug.5.
Prepare journal entries for August 10 and 15.Omit explanations.

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Definitions:

Dividend Payments

Distribution of a portion of a company's earnings, decided by the board of directors, to a class of its shareholders.

Comparative Data

Information that is compared across different time periods, companies, or other variables to analyze performance or condition.

Investment Classification

The categorization of investments based on their characteristics, risk, and objectives.

Statement of Financial Position

A financial statement that outlines an organization's assets, liabilities, and equity at a specific point in time; commonly known as a balance sheet.