Q1) Make the essential general journal entries for month of October for the Seinfeld Company for each situation given below. Seinfeld uses perpetual inventory system.
||Purchased merchandise from Festivus Incorporated for $20,000 on account
Credit terms: 2/10, n/30; Freight terms: FOB shipping point.
||Paid freight bill of $470 for merchandise purchased on October 8.
||Paid for merchandise purchased on October 8. The company takes all discounts to which it is entitled.
||Sold merchandise for $16,000 to Cosmo Kramer on account. The cost of the merchandise sold was $10,000. Credit terms: 2/10, n/30.
||Issued a credit memo to Cosmo Kramer for $1,000 for merchandise returned by him from the sale on October 20. The cost of the merchandise returned was $625. (Merchandise was in new condition and could be sold again.)
||Received balance due from Cosmo Kramer for sale on October 20.