Journalize the following transactions for the buyer, Brooks Company, using the gross method to account for purchase discounts. Assume a perpetual inventory system. a. November 6 Purchased merchandise from Nelson Company on account, $10,000, terms 4/10, n/30. The goods are shipped FOB shipping point, freight prepaid by seller, $450.
b. November 12 Returned to Nelson Company merchandise previously purchased on account, $2,300.
c. November 16 Paid the amount due to Nelson Company.

Brooks Company

Journal Entries

a. November 6:

Debit Inventory $10,000

Credit Accounts Payable (Nelson Company) $10,000

To record the purchase of goods on account, terms 4/10, n/30.

b. November 12:

Debit Accounts Payable (Nelson Company) $2,300

Credit Inventory $2,300

To record the return of goods.

c. November 16:

Debit Accounts Payable (Nelson Company) $7,700

Credit Cash Discount $308

Credit Cash Account $7,392

To record the payment of cash on account.

Explanation:

Brooks Company uses Journal entries to record its business transactions as they occur on a daily basis.  Journal entries identify the accounts to be debited and the accounts to be credited as they will appear in the general ledger.

answerjointly by the fed and by the behavior of individuals who hold money and of banks in which money is held;