Question

Journal for Merchandise I System Webster Company was established on July 1. Its sales terms arc 2/10. n/30. Credit terms for its purchases vary with the supplier. Selected transactions for the first month of operations arc given below. Unless noted, all transactions are on account and involve merchandise held for resale. Webster Company uses the perpetual inventory system. Paid freight on shipment to Ward. Inc.. S90. (debit Delivery Expense) Returned $500 worth of the goods purchased July I from Dawson. Inc.. because some goods were damaged. Dawson approved the return. Received returned goods from Ward, Inc.. worth $200 ($150 cost). Paid Dawson, Inc.. the amount due. Purchased goods from Dorn Company with a list price of $2,600. Terms 2/10. n/30. Paid freight on shipment from Dorn Company. $150. Received the amount due from Ward. Inc. Sold merchandise to Colby Corporation. $3,200 ($2,400 cost). Mailed a check to Penn Company for the amount due on its July 2 invoice Received an allowance of $200 from Dorn Company for defective merchandise purchased on July 10. Paid Dorn Company the amount due. Received the amount due from Colby Corporation.