Alternate Demonstration Problem #2
Koda Company is a wholesale company that had the following purchase and sales
transactions related to its merchandise inventory during the month of May.
Purchased $20,000 of merchandise on account from Webber Mfg. Co.
Credit terms: 2/10, n/30. FOB shipping point
Received and paid the $1,000 shipping bill from Interstate Shipping for
the goods purchased on March 1
Received a credit memo for the return of $5,000 of the goods purchased
on March 1 which had arrived damaged.
Paid Webber Mfg. Co. the amount due.
Sold merchandise on account to Dover Company for $5,000. The cost of
the merchandise was $3,000. (cost is 60% of the retail value) Terms:
2/10, n/30; FOB Destination
Paid Crosstown Shipping $100 to deliver the goods sold on March 15
Dover returned $1,000 of the goods they purchased on March 15. You
had sent them the wrong merchandise.
Received the amount due from Dover Co.
Requirement 1: Record the transactions assuming Koda Company uses perpetual
Requirement 2: Record the transactions assuming that Koda Company uses periodic