Reference no: EM132564231

Question - UNIVERSAL APPLIANCES uses a perpetual system The following are the recent merchandising transactions:

2017 -

Dec 17 Purchased 10 juicer machines from Westpoint on credit. Invoice price, $300 per unit, for a total of $3,000. The terms of purchase were 2/10, n/30.

Dec 18 Sold two of these units for $450 each.

Dec 27 Paid the account payable to Westpoint within te discount period.

Required -

(a) Record journal entries assuming that UNIVERSAL APPLIANCES records purchases at:

1. Net Cost

2. Gross Invoice Price

(b) Assume that UNIVERSAL APPLIANCES did not pay within discount period. Record journal entries for making payment on Dec 29 at:

1. Net Cost Method

2. Gross Invoice Price Method