Reference no: EM133099872

Question - The following information was presented by the bookkeeper for NorthWave Communications for the month of August 2019.

Aug 8 Purchased $237,700 of inventory on account from Beta Wholesalers, terms 2/10, net 30

Aug 10 A portion of the inventory purchased from Beta Wholesalers was defective. NorthWave returned $670 worth of inventory to the supplier.

Aug 12 Sold $102,600 of products to SouthShore on account, terms 2/10, net 30; cost of goods sold was $41,040 for this transaction.

Aug 14 SouthShore returned $2,052 of goods purchased on account. The cost of goods sold for the returned inventory is $1,231.

Aug 17 Purchased goods from EastCoast Trading Communications on account for $19,500 with terms of 3/10, net 30.

Aug 18 Some of the inventory purchased from EastCoast Trading Communications was slightly damaged. NorthWave decided to keep the inventory, but will receive a $640 allowance.

Aug 19 Sold $51,500 of products to West Island on account, terms 2/10, net 30; cost of goods sold was $20,600 for this transaction.

Aug 20 West Island discovered some scratches on some of the products they purchased on Aug 19. They will keep the product and NorthWave will offer a $290 allowance.

Aug 21 Paid the amount owing to Beta Wholesalers.

Aug 23 Received payment in full from SouthShore.

Aug 24 Received payment in full from West Island.

Aug 25 Paid the amount owing to EastCoast Trading Communications.

Aug 31 A count of inventory shows that $470 is missing. Make a journal entry to record the inventory shrinkage.

Required - Prepare the journal entries to record the above transactions. Assume the company uses the perpetual inventory system.