*EXERCISE 5-8
Purpose: (L.O. *6) This exercise reviews the journal entries to record sales of merchandise inventory under a periodic inventory system.
A list of transactions for the Randy Travis Sales Company appears below. A periodic inventory system is used.
| July 17 | Sold merchandise with a cost of $300 to Eric Nelson for cash, $520. |
| 18 | Sold merchandise with a cost of $340 to Guy Sellars for $580, terms 2/10, n/30. |
| 23 | Issued a credit memo for $80 to Guy Sellars because of a sales allowance granted to him due to the inferior quality of goods sold to him on July 18. |
| 26 | Received payment from Guy Sellars for amount due for sale of July 18. |
| 27 | Sold merchandise to Jason Zahner, $200, terms n/30. The merchandise cost $120. |
| Aug. 25 | Received payment in full from Jason Zahner. |
| Sept. 5 | Sold merchandise to Andrea Brotherly, $600, terms 2/10, n/30. The merchandise cost $350. |
| 22 | Received payment from Andrea Brotherly for amount due for sale of Sept. 5. |
Instructions
Prepare the journal entries to record these transactions on the books of the Randy Travis Sales Company.
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