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On March 1, Showcase Co., a furniture wholesaler, sells merchandise to Balboa Co. on account, $254,500, terms n/30. The cost of the merchandise sold is $152,700. On March 5, Showcase Co. issues a credit memo for $30,000 for merchandise returned prior to Balboa Co. paying the original invoice on March 29. The cost of the merchandise returned is $17,500.
Problem 1: Journalize Balboa Co.'s entries for (a) the purchase, (b) the return of the merchandise for credit, and (c) the payment of the invoice. Refer to the Chart of Accounts for exact wording of account titles
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