Reference no: EM132679762

Question - The following selected transactions were completed during August between Summit Company and Beartooth Co. Both companies use the net method under a perpetual inventory system.

Aug 1 Summit Company sold merchandise on account to Beartooth Co., $48,300, terms FOB destination, 2/15, n/eom. The cost of the goods sold was $29,960.

Aug 2 Summit Company paid freight of $1,230 for delivery of merchandise sold to Beartooth Co. on August 1.

Aug 5 Summit Company sold merchandise on account to Beartooth Co., $70,210, terms FOB shipping point, n/eom. The cost of the goods sold was $38,490.

Aug 9 Beartooth Co. paid freight of $2,450 on August 5 purchase from Summit Company.

Aug 15 Summit Company sold merchandise on account to Beartooth Co., $55,200, terms FOB shipping point, n/45. Summit paid freight of $1,795, which was added to the invoice. The cost of the goods sold was $33,780.

Aug 16 Beartooth Co. paid Summit Company for purchase of August 1.

Aug 20 Summit Company paid Beartooth Co. a cash refund of $1,000 for defective merchandise purchased on August 1. Beartooth Co. kept the merchandise.

Aug 31 Beartooth Co. paid Summit Company on account for purchase of August 5.

Aug 31 Summit Company issued Beartooth Co. a credit memo for merchandise with an invoice amount of $3,700 that was returned from the August 15 sale. The cost of the merchandise returned was $2,200.

Required - Journalize the August transactions for (1) Summit Company and (2) Beartooth Co. Refer to the Chart of Accounts of the appropriate company for exact wording of account titles.