Sales-Related and Purchase-Related Transactions for Seller and Buyer Using Perpetual Inventory System The following selected transactions were completed during April between Swan Company and Bird Company: Apr. 2. Swan Company sold merchandise on account to Bird Company, $19,900, terms FOB shipping point, 1/10, n/30. Swan Company paid freight of $435, which was added to the invoice. The cost of the merchandise sold was $12,500. 8. Swan Company sold merchandise on account to Bird Company, $25,000, terms FOB destination, 2/15, n/30. The cost of the merchandise sold was $15,000. 8. Swan Company paid freight of $650 for delivery of merchandise sold to Bird Company on April 8. 12. Bird Company paid Swan Company for purchase of April 2. 18. Swan Company paid Bird Company a refund of $2,000 for defective merchandise in the April 2 purchase. Bird Company agreed to keep the merchandise. 23. Bird Company paid Swan Company for purchase of April 8. 24. Swan Company sold merchandise on account to Bird Company, $11,200, terms FOB shipping point, n/45. The cost of the merchandise sold was $6,700. 26. Bird Company paid freight of $280 on April 24 purchase from Swan Company. Required: 1. Journalize the April transactions for Bird Company (the buyer). If an amount box does not require an entry, leave it blank.

1. Bird Company (Buyer)

Apr-02Dr Merchandise Inventory$20,335

Cr Accounts Payable $20,335

Apr-08Dr Merchandise Inventory$25,000

Cr Accounts Payable $25,000

Apr-08No entry

Apr-12Dr Accounts Payable$20,335

Cr Cash $19,937

Cr Merchandise Inventory $ 398

Apr-18 Dr Cash$ 2,000

Cr Merchandise Inventory $ 2,000

Apr-23 Dr Accounts Payable$25,000

Cr Cash $24,750

Cr Merchandise Inventory $ 250

Apr-24 Dr Merchandise Inventory$11,200

Cr Accounts Payable $11,200

Apr-26 Dr Merchandise Inventory$280

Cr Cash $280

2.Swan Company (Seller)

Apr-02 Dr Accounts Receivable$20,335

Cr Sales Revenue $19,900

Cr Cash $435

Dr Cost of Goods Sold$12,500

Dr Merchandise Inventory $12,500

Apr-08 Dr Accounts Receivable$ 25,000

Cr Sales Revenue $ 25,000

Dr Cost of Goods Sold$15,000

Cr Merchandise Inventory $15,000

Apr-08 Dr Delivery Expense$650

Cr Cash $650

Apr-12 Dr Cash$19,937

Dr Sales Discounts$ 398

Cr Accounts Receivable $20,335

Apr-18 Dr Sales Returns and allowances$ 2,000

Cr Cash $ 2,000

Apr-23Dr Cash$ 24,750

Dr Sales Discounts$ 250

Cr Accounts Receivable $25,000

Apr-24 Dr Accounts Receivable$11,200

Cr Sales Revenue $11,200

Dr Cost of Goods Sold$6,700

Cr Merchandise Inventory $6,700

Apr-26No entry

Explanation:

1. Preparation of the journal entry for Bird Company (the buyer).

Bird Company (Buyer)

Apr-02Dr Merchandise Inventory$20,335

Cr Accounts Payable $20,335

($19,900+$435)

Apr-08Dr Merchandise Inventory$25,000

Cr Accounts Payable $25,000

Apr-08No entry

Apr-12Dr Accounts Payable$20,335

($19,900+$435)

Cr Cash $19,937

($20,334-$398)

Cr Merchandise Inventory $ 398

($19,900*2%)

Apr-18 Dr Cash$ 2,000

Cr Merchandise Inventory $ 2,000

Apr-23 Dr Accounts Payable$25,000

Cr Cash $24,750

($25,000-$250)

Cr Merchandise Inventory $ 250

(1%*$25,000)

Apr-24 Dr Merchandise Inventory$11,200

Cr Accounts Payable $11,200

Apr-26 Dr Merchandise Inventory$280

Cr Cash $280

2. Preparation of the journal entry for Bird Company the (Seller).

Swan Company (Seller)

Apr-02 Dr Accounts Receivable$20,335

($19,900+$435)

Cr Sales Revenue $19,900

Cr Cash $435

Dr Cost of Goods Sold$12,500

Dr Merchandise Inventory $12,500

Apr-08 Dr Accounts Receivable$ 25,000

Cr Sales Revenue $ 25,000

Dr Cost of Goods Sold$15,000

Cr Merchandise Inventory $15,000

Apr-08 Dr Delivery Expense$650

Cr Cash $650

Apr-12 Dr Cash$19,937

($20,335-$398)

Dr Sales Discounts$ 398

(2%*$19,900)

Cr Accounts Receivable $20,335

(19,900+435)

Apr-18 Dr Sales Returns and allowances$ 2,000

Cr Cash $ 2,000

Apr-23Dr Cash$ 24,750

Dr Sales Discounts$ 250

(1%*25,000)

Cr Accounts Receivable $25,000

Apr-24 Dr Accounts Receivable$11,200

Cr Sales Revenue $11,200

Dr Cost of Goods Sold$6,700

Cr Merchandise Inventory $6,700

Apr-26No entry