1

Purchased merchandise with an invoice price of $78,000 and credit terms of 2/10, n/30.

11

Paid supplier the amount owed from the August 1 purchase.

May

3

Allied made its first and only purchase of inventory for the period on May 3 for 2,000 units at a price of $10 cash per unit (for a total cost of $20,000).

5

Allied sold 1,000 of the units in inventory for $14 per unit (invoice total: $14,000) to Macy Co. under credit terms 2/10, n/60. The goods cost Allied $10,000.

7

Macy returns 100 units because they did not fit the customer’s needs (invoice amount: $1,400). Allied restores the units, which cost $1,000, to its inventory.

8

Macy discovers that 100 units are scuffed but are still of use and, therefore, keeps the units. Allied gives a price reduction (allowance) and credits Macy's accounts receivable for $600 to compensate for the damage.

15

Allied receives payment from Macy for the amount owed on the May 5 purchase; payment is net of returns, allowances, and any cash discount.

2

Purchased $5,500 of merchandise from Lyon Company with credit terms of 2/15, n/60, invoice dated April 2, and FOB shipping point.

3

Paid $200 cash for shipping charges on the April 2 purchase.

4

Returned to Lyon Company unacceptable merchandise that had an invoice price of $800.

17

Sent a check to Lyon Company for the April 2 purchase, net of the discount and the returned merchandise.

18

Purchased $10,300 of merchandise from Frist Corp. with credit terms of 1/10, n/30, invoice dated April 18, and FOB destination.

21

After negotiations, received from Frist a $500 allowance toward the $10,300 owed on the April 18 purchase.

28

Sent check to Frist paying for the April 18 purchase, net of the allowance and the discount.