Prepare journal entries
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Journalize the following merchandising transactions for CSI Systems assuming it uses (a) a periodic inventory system and (b) a perpetual inventory system.
1. On November 1, CSI Systems purchases merchandise for $1,400 on credit with terms of 2 5,
n 30, FOB shipping point; invoice dated November 1.
2. On November 5, CSI Systems pays cash for the November 1 purchase.
3. On November 7, CSI Systems discovers and returns $100 of defective merchandise purchased on
November 1 for a cash refund.
4. On November 10, CSI Systems pays $80 cash for transportation costs with the November 1 purchase.
5. On November 13, CSI Systems sells merchandise for $1,500 on credit. The cost of the merchandise is $750.
6. On November 16, the customer returns merchandise from the November 13 transaction. The returned items sell for $200 and cost $100.
Exercise 5-13A
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Solution Summary
This posting journalizes merchandising transactions for CSI Systems assuming it uses (a) a periodic inventory system and (b) a perpetual inventory system.
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