Karns Company purchased merchandise on account from Bailey Office Suppliers for $174,000, with terms of 2/10, n/30 Karns paid freight costs of $5,000. During the discount period, Karns returned some merchandise and paid $156,800 as payment in full. Karns uses a perpetual inventory system. Prepare the journal entries that Karns Company made to record:
(1) the purchase of merchandise.
(2) the payment of freight.
(3) the return of merchandise.
(4) the payment on account.

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The Answer of Karns Company purchased merchandise on account from Bailey Office Suppliers for $174,000, with terms of 2/10, n/30 Karns paid freight costs of $5,000. During the discount period, Karns returned some merchandise and paid $156,800 as payment in full. Karns uses a perpetual inventory system. Prepare the journal entries that Karns Company made to record:
(1) the purchase of merchandise.
(2) the payment of freight.
(3) the return of merchandise.
(4) the payment on account.

Karns Company Purchased Merchandise on Account from Bailey Office Suppliers