TRADE DISCOUNTS & ALLOWANCES

JUNE 5 - PURCHASED P30,000 OF MERCHANDISE ON ACCOUNT. TERMS: 2/10, n/30​ ​

• DEBIT: Purchases P30,000

  CREDIT: Purchase Discount P30,000

• DEBIT: Purchases P30,000

  CREDIT: Cash P30,000

• DEBIT: Purchases P30,000

  CREDIT: A/R P30,000

• DEBIT: Purchases P30,000

  CREDIT: A/P P30,000

JUNE 8 - RETURNED MERCHANDISE PURCHASED ON ACCOUNT ON JUNE 5, P5,000.

• DEBIT: Purchases P30,000

  CREDIT: PRA P30,000

• DEBIT: Cash P5,000

  CREDIT: PRA P5,000

• DEBIT: A/P P5,000

  CREDIT: PRA P5,000

• DEBIT: PRA P5,000

  CREDIT: SALES P5,000

JUNE 15 - PAID FOR PURCHASE OF JUNE 5, P30,000 WITH TERMS: 2/10, n/30 AND RETURNED MERCH. P5,000.

• DEBIT: CASH P24,500

  DEBIT: PURCHASE DISCOUNT P500

  CREDIT: A/P P25,000

• DEBIT: A/P P25,000

  CREDIT: PURCHASE DISCOUNT P500

  CREDIT: CASH P24,500

• DEBIT: A/P P25,000

  CREDIT: CASH P25,000

• DEBIT: A/R P25,000

  CREDIT: CASH P25,000

JUNE 18 - SOLD MERCHANDISE ON ACCOUNT, P27,000. TERMS: 1, n/30

• DEBIT: CASH P27,000

  CREDIT: SALES P27,000

• DEBIT: A/R P27,000

  CREDIT: SALES P27,000

• DEBIT: A/R P26,730

  CREDIT: SALES P26,730

• DEBIT: CASH P26,730

  DEBIT: SALES DISCOUNT P270

  CREDIT: A/R P27,000

JUNE 21 - RECEIVED MERCHANDISE PURCHASED ON ACCOUNT ON JUNE 18, P3,000.

• DEBIT: CASH P3,000

  CREDIT: SRA P3,000

• DEBIT: SRA P3,000

  CREDIT: A/R P3,000

• DEBIT: SRA P3,000

  CREDIT: CASH P3,000

• DEBIT: SRA P3,000

  CREDIT: A/P P3,000

JUNE 22 - PURCHASED MERCHANDISE FOR CASH P5,000. FOB SHIPPING POINT, FREIGHT PREPAID P900.

• DEBIT: CASH P5,000

  CREDIT: PURCHASES P5,000

  DEBIT: FREIGHT-IN P900

  CREDIT: CASH P900

• DEBIT: PURCHASES P5,000

  CREDIT: CASH P5,000

  DEBIT: FREIGHT-IN P900

  CREDIT: CASH P900

• DEBIT: PURCHASES P5,000

  CREDIT: A/R P5,000

  DEBIT: FREIGHT-OUT P900

  CREDIT: A/R P900

• DEBIT: PURCHASES P5,000

  CREDIT: CASH P5,000

  DEBIT: FREIGHT-IN P900

  CREDIT: A/P P900

JUNE 28 - RECEIVED A FULL PAYMENT FROM JUNE 18, 27,000 WITH RETURNS OF P3,000. TERMS: 1, n/30

• DEBIT: CASH P27,000

  CREDIT: A/R P27,000

• DEBIT: CASH P23,730

  CREDIT: SALES P23,730

• DEBIT: CASH P24,000

  CREDIT: A/R P24,000

• DEBIT: CASH P23,730

  CREDIT: A/P P23,730

Answer explanation

Match the following ACCOUNTS

• PURCHASE DISCOUNTS

• FREIGHT-IN

• BUYER

• PURCHASE RETURNS & ALLOWANCES

• SALES DISCOUNT

• SALES

• SELLER

• PURCHASES

• CREDIT

• FREIGHT-OUT

PURCHASE DATE: JULY 5, 2023

AMOUNT: P65,999

TERMS: 2/10 EOM, N/60

PAYMENT DATE: JULY 31, 2023

Answer explanation

PURCHASE DATE: JULY 5, 2023

AMOUNT: P65,999

TERMS: 2/10 EOM, N/60

PAYMENT DATE: JULY 31, 2023

DEBIT: A/P P65,999

CREDIT: PURCHASE DISCOUNT P1,319.98

CREDIT: CASH P64,679.02

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