[thuy677]

Sansomite Co. distributes suitcases to retail stores and extends credit terms of 1/10, n/30 to all of its customers. At the end of June, Sansomite's inventory consisted of suitcases costing $1,200. During the month of July the following merchandising transactions occurred

July 1 Purchased suitcases on account for $1,900 from Trunk Manufacturers, FOB destination, terms 2/10, n/30. The appropriate party also made a cash payment of $104 for freight on this date.
3 Sold suitcases on account to Satchel World for $2,200. The cost of suitcases sold is $1,226.
9 Paid Trunk Manufacturers in full.
12 Received payment in full from Satchel World.

My problem is July 9 and 12

[pready]

Jul 1) This transaction depends on what method you are using. If you are using the Gross method to record the purchase then this entry will be: Debit Purchases for 1900 and Credit Accounts Payable for the amount, then your Jul 9 entry will be: Debit Accounts Payable for the amount of the Jul 1 purchase, Credit Purchase Discounts for 38, and Credit Cash for 1862

On your Jul 1 purchase if you are using the Net Method your journal entry will be: Debit Purchases for 1862 and Credit Accounts Payable for the amount. Your Jul 9 transaction will be: Debit Accounts Payable for 1862 and Credit Cash for 1862.

Jul 12) Debit Cash for 2,200 and Credit Accounts Receivable for the amount.

Note: Your Jul 1 transaction will include a journal entry for the freight-in.

Your Jul 3 transaction will have two sets of journal entries; 1 for the sale and 1 for COGS.

[thuy677]

Thank you very much that really and I understand it now thank you