Powell’s Book Warehouse distributes hardcover

| June 14, 2018

Problem 5-1APowell’s Book Warehouse distributes hardcover books to retail stores and extends credit terms of 2/10, n/30 to all of its customers. At the end of May, Powell’s inventory consisted of books purchased for $1,800. During June, the following merchandising transactions occurred.June 1Purchased books on account for $1,600 from Kline Publishers, FOB destination, terms 2/10, n/30. The appropriate party also made a cash payment of $50 for the freight on this date.3Sold books on account to Reading Rainbow for $2,500. The cost of the books sold was $1,440.6Received $100 credit for books returned to Kline Publishers.9Paid Kline Publishers in full, less discount.15Received payment in full from Reading Rainbow.17Sold books on account to Blanco Books for $1,800. The cost of the books sold was $1,080.20Purchased books on account for $1,500 from Dietz Publishers, FOB destination, terms 2/15, n/30. The appropriate party also made a cash payment of $50 for the freight on this date24Received payment in full from Blanco Books.26Paid Dietz Publishers in full, less discount.28Sold books on account to Reddy Bookstore for $1,400. The cost of the books sold was $850.30Granted Reddy Bookstore $120 credit for books returned costing $72.Journalize the transactions for the month of June for Powell’s Book Warehouse using a perpetual inventory system.

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