DUE TODAY. Accounting sheet ( Merchandising Operations and the Multiple-Step Income Statement )

Exercise 5-2

Question This information relates to McCarthy Company.

1. On April 5, sold merchandise worth of $8,000 to Lewis Co. for $16,000, terms 2/10, n/30.

2. On April 8, received returned merchandise related to the April 5 transaction from Lewis Co. worth of $1,800 that was sold for $3,600.

Instructions

Prepare the journal entries to record the transactions listed above on the books of McCarthy Company.

Solution (1) April 5 Accounts Receivable ........................................ 16,000 Sales Revenues ...................................... 16,000 Cost of Goods Sold ........................................... 8,000 Inventory ................................................. 8,000 (2) April 8 Sales Revenues ................................................ 3,600 Accounts Receivable ............................... 3,600 Inventory ........................................................... 1,800 Cost of Goods Sold ................................. 1,800