Appendix I
Review Exercise Solutions
407
Chapter 7 Review Exercise—Solutions
Part 1
a) Journalize the December transactions. Assume the goods were shipped FOB shipping point.
JOURNAL Page 1
Date
2016
Account Title and Explanation
Debit Credit
Dec 3 Inventory
50,000
Accounts Payable
50,000
Purchased inventory on account
Dec 6 Inventory
200
Cash
200
Paid freight charges
Dec 8 Accounts Payable
2,000
Inventory
2,000
Purchase return
Dec 11 Accounts Payable
48,000
Inventory
960
Cash
47,040
Paid supplier and took discount
