E8-8 (Purchases Recorded, Gross Method) Cruise Industries purchased $10,800 of merchandise on February 1, 2014, subject to a trade discount of 10% and with credit terms of 3/15, n/60. It returned $2,500 (gross price before trade or cash discount) on February 4. The invoice was paid on February 13.

Instructions

  • (a)Assuming that Cruise uses the perpetual method for recording merchandise transactions, record the purchase, return, and payment using the gross method.
  • (b)Assuming that Cruise uses the periodic method for recording merchandise transactions, record the purchase, return, and payment using the gross method.
  • (c)At what amount would the purchase on February 1 be recorded if the net method were used?

Is this part of your assignment? ORDER NOW