At the beginning of June, Circuit Country has a balance in inventory of $2,050. The following transactions occur during the month of June.
June 2 Purchase radios on account from Radio World for $1,750, terms 2/15, n/45.
June 4 Pay cash for freight charges related to the June 2 purchase from Radio World, $210. June 8 Return defective radios to Radio World and receive credit, $200.
June 10 Pay Radio World in full. June 11 Sell radios to customers on account, $3,100, that had a cost of $2,250.
June 18 Receive payment on account from customers, $2,100.
June 20 Purchase radios on account from Sound Unlimited for $2,850, terms 2/10, n/30.
June 23 Sell radios to customers for cash, $4,350, that had a cost of $2,650.
June 26 Return damaged radios to Sound Unlimited and receive credit of $500.
June 28 Pay Sound Unlimited in full.
Required:
a. Assuming that Circuit Country uses a perpetual inventory system, record transactions using the following account titles: Cash, Accounts Receivable, Inventory, Accounts Payable, Sales, and Cost of Goods Sold.
b. Prepare the top section of the multiple-step income statement through gross profit for the month of June.
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At the beginning of June, Circuit Country has a balance in inventory of $2,050. The following transa...
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