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Gamegirl Inc., has the following transactions during August.
August 6 Sold 64 handheld game devices for $170 each to DS Unlimited on account, terms 1/10, net 60. The cost of the 64 game devices sold, was $150 each.
August 10 DS Unlimited returned four game devices purchased on 6th August since they were defective.
August 14 Received full amount due from DS Unlimited.
Required:
1. Prepare the transactions for GameGirl, Inc., assuming the company uses a perpetual inventory system.

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tanseershar

Answer:

Explanation:

1.August 6.

Account Receivable-Ds Unlimited  (64*170)        Dr.$10,880

Sales Revenue                                                       Cr.$10,880

Cost of Goods Sold  ($150*64)                Dr.$9,600

Inventory                                                    Cr.$9,600

2.August 10.

Inventory/Sales Revenue         (4*170)           Dr.$680

Account Receivable-Ds Unlimited                Cr.$680

3. August 14.

  Cash                     (10,880-680)*99%         Dr.$10,098

  Cash Discount                                            Dr.$     102

   Accounts Receivable                                Cr.$ 10,200      

Note:

The gross method of discount is used which means at time of receipt, discount impact is taken. In this question 1/10 means 1% discount allowed if payment made within 10 days of sale. This means DS unlimited qualifies for cash discount as payment is received on 14 August

The journal entries in the case when the company uses a perpetual inventory system are as follows:

Journal entries:

1. On August 6.

Account Receivable-Ds Unlimited  (64*170)        Dr.$10,880

        Sales Revenue                                                       Cr.$10,880

Cost of Goods Sold  ($150*64)                Dr.$9,600

       Inventory                                                    Cr.$9,600

2. On August 10.

Inventory/Sales Revenue         (4*170)           Dr.$680

       Account Receivable-Ds Unlimited                Cr.$680

3. On August 14.

 Cash                     (10,880-680)*99%         Dr.$10,098

 Cash Discount                                            Dr.$     102

                Accounts Receivable                                Cr.$ 10,200

Learn more about journal entry here:      https://brainly.com/question/24146116

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