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Practice Problem 1

The Bell Tower Company had the following transactions for the month of January. Journalize the following purchase transactions for Bell Tower Company (BTC).

Jan. 1	BTC purchased $400 of merchandise for cash.
Jan. 5	BTC purchased $3,000 of merchandise on account (terms n/30).
Jan. 20	BTC paid for the merchandise purchased on Jan. 5.
Jan. 22	BTC purchased $2,000 of merchandise on account (terms 1/15, n/30).
Jan. 23	BTC returned $200 of the merchandise purchased on Jan. 22.
Jan. 30	BTC paid for the merchandise purchased on Jan. 22, less the amount returned.

General Journal
Date	Accounts and explanation	Debit	Credit
Jan. 1	Merchandise inventory	$400	-
-	Cash	-	$400
-	Purchased merchandise for cash.	-	-
Jan. 5	Merchandise inventory	$3,000	-
-	Accounts payable	-	$3,000
-	Purchased merchandise on account. Terms n/30.	-	-
Jan. 20	Accounts payable	$3,000	-
-	Cash	-	$3,000
-	Paid for merchandise purchased on January 20.	-	-
Jan. 22	Merchandise inventory	$2,000	-
-	Accounts payable	-	$2,000
-	Purchased merchandise on account. Terms 1/15, n/30.	-	-
Jan. 23	Accounts payable	$200	-
-	Merchandise inventory	-	$200
-	Returned merchandise purchased on January 22.	-	-
Jan. 30	Accounts payable	$1,800	-
-	Cash	-	$1,782
-	Merchandise inventory	-	$18
-	Paid for merchandise purchased on January 22, less merchandise returned.	-	-

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