91Ó°ÊÓ

Journalize the following sales transactions for Antique Mall. Explanations are not required. The company estimates sales returns at the end of each month.

Jan. 4 Sold \(16,000 of antiques on the account; credit terms are n/30. The cost of goods is \)8,000.

8 Received a \(300 sales return on damaged goods from the customer. The cost of goods damaged is \)150.

13 Antique Mall received payment from the customer on the amount due from Jan. 4, less the return.

20 Sold \(4,900 of antiques on the account; credit terms are 1/10, n/45, FOB destination. The cost of goods is \)2,450.

20 Antique Mall paid $70 on freight out.

29 Received payment from the customer on the amount due from Jan. 20, less the discount.

Step by step solution

01

Meaning of Sales Transactions  

In accounting, sales transactions refer to the events that take the goods and services out from the business concern against generating an asset, i.e., cash or accounts receivable. Sales are the primary source of generatingrevenues for the businesses.

02

Preparation of journal entries

Date	Accounts and Explanation	Debit ($)	Credit ($)
Jan 4	Accounts receivable	16,000
	Sales revenue		16,000
Jan 4	Cost of goods sold	8,000
	Merchandise inventory		8,000
Jan 8	Sales return	300
	Accounts receivable		300
Jan 8	Merchandise inventory	150
	Cost of goods sold		150
Jan 13	Cash (16000-300)	15,700
	Accounts receivable		15,700
Jan 20	Accounts receivable	4,900
	Sales revenue		4,900
Jan 20	Cost of goods sold	2,450
	Merchandise inventory		2,450
Jan 20	Delivery expense	70
	Cash		70
Jan 29	Cash (4900-1%*4900)	4,851
	Accounts receivable		4,851

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