Consider the following transactions for Partytime Toys:

October 8 Partytime Toys buys $141,800 worth of MegoBloack toys on account with credit terms of 2/10, n/30

October 11 Partytime Toys returns $14,100 of the merchandise to MegoBlock due to damage during shipment.

October 15 Partytime Toys paid the amount due, less the return and discount.

Required

1. Journalize the purchase transactions. Explanations are not required.

2. In the final analysis, how much did the inventory cost Partytime Toys?

Question

Baylee Burke

Business

20 August, 00:27

Consider the following transactions for Partytime Toys:

October 8 Partytime Toys buys $141,800 worth of MegoBloack toys on account with credit terms of 2/10, n/30

October 11 Partytime Toys returns $14,100 of the merchandise to MegoBlock due to damage during shipment.

October 15 Partytime Toys paid the amount due, less the return and discount.

Required

1. Journalize the purchase transactions. Explanations are not required.

2. In the final analysis, how much did the inventory cost Partytime Toys?

+5

Answers (1)

Know the Answer?

Alicia Sloan · Answer 1

1. Journalize the entries:

October 8:

Dr Purchases $141,800

Cr Account Payable $141,800

October 11:

Dr Accounts Payable $ 14,100

Cr Purchase Return $ 14.100

October 15:

Dr Accounts Payable $114,930 (141,800-14,100) * 90%

Cr Cash $ 114,930.

2. The inventory cost $114,930 to Party Time Toys.