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Journalize the following transactions that occurred in September 2018 for Aquamarines. No explanations are needed. Identify each accounts payable and accounts receivable with the vendor or customer name. Aquamarines estimates sales returns at the end of each month.

Sep. 3 Purchased merchandise inventory on account from Sharpner Wholesalers, \(5,500. Terms 2/15, n/EOM, FOB shipping point.

4 Paid freight bill of \)85 on September 3 purchase.

4 Purchased merchandise inventory for cash of \(1,600.

6 Returned \)1,300 of inventory from the September 3 purchase.

8 Sold merchandise inventory to Herman Company, \(5,700, on account. Terms 2/15, n/35. Cost of goods, \)2,565.

9 Purchased merchandise inventory on account from Tucker Wholesalers, \(6,000. Terms 3/10, n/30, FOB destination.

10 Made payment to Sharpner Wholesalers for goods purchased on September 3, less return and discount.

12 Received payment from Herman Company, less discount.

13 After negotiations, I received a \)500 allowance from Tucker Wholesalers.

15 Sold merchandise inventory to Jerome Company, \(2,800, on account. Terms n/EOM. Cost of goods, \)1,200.

22 Made payment, less allowance, to Tucker Wholesalers for goods purchased on September 9.

23 Jerome Company returned \(200 of the merchandise sold on September 15. Cost of goods, \)80.

25 Sold merchandise inventory to Small for \(1,800 on account that cost \)738. Terms of 3/10, n/30 was offered, FOB shipping point. As a courtesy to Small, $40 of freight was added to the invoice, for which Aquamarines paid cash.

29 Received payment from Small, less discount.

30 Received payment from Jerome Company, less return.

Step by step solution

01

Meaning of Accounts Receivable

Accounts receivable denotes the customer to whom a business concern sold goods or provided services on credit. Accounts receivables also indicate the amount receivable by the company and are reported on the current asset section of the balance sheet.

02

Preparation of journal entries

Date	Accounts and Explanation	Debit ($)	Credit ($)
Sep 3	Merchandise inventory	5,500
	Accounts payable (Sharpner Wholesalers)		5,500
Sep 4	Merchandise inventory	85
	Cash		85
Sep 4	Merchandise inventory	1,600
	Cash		1,600
Sep 6	Accounts payable (Sharpner Wholesalers)	1,300
	Merchandise inventory		1,300
Sep 8	Accounts receivable (Herman company)	5,700
	Sales revenue		5,700
Sep 8	Cost of goods sold	2,565
	Merchandise inventory		2,565
Sep 9	Merchandise inventory	6,000
	Accounts payable (Tucker wholesaler)		6,000
Sep 10	Accounts payable (Sharpner wholesalers) [5500-1300]	4,200
	Merchandise inventory (4200*2%)		84
	Cash		4,116
Sep 12	Cash	5,586
	Discount (5700*2%)	114
	Accounts receivable (Herman company)		5,700
Sep 13	Accounts payable (Tucker Wholesalers)	500
	Purchase returns and allowances		500
Sep 15	Accounts receivable (Jerome company)	2,800
	Sales revenue		2,800
Sep 15	Cost of goods sold	1,200
	Merchandise inventory		1,200
Sep 22	Cash (6000-500)	5,500
	Accounts payable (Tucker wholesalers)		5,500
Sep 23	Sales returns and allowances	200
	Accounts receivable (Jerome company)		200
Sep 23	Merchandise inventory	80
	Cost of goods sold		80
Sep 25	Accounts receivable (Small)	1,800
	Sales		1,800
Sep 25	Cost of goods sold	778
	Merchandise inventory		738
	Cash		40
Sep 29	Cash	1,746
	Discount (1800*3%)	54
	Accounts receivable (Small)		1,800
Sep 30	Cash (2800-200)	2,600
	Accounts receivable (Jerome company)		2,600

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