An auto dealer uses a perpetual inventory system.The dealer incurred the following transactions during the month of May:
1.On May 1,a dealer purchased 10 vehicles on account at $20,000 each,with credit terms of 2/10,net 30.
2.On May 2,the dealer returned one vehicle due to a product defect.
3.On May 3,the dealer sold 5 vehicles for $25,000 each on account to a local town.The credit terms were 3/10,net 30.
4.On May 9,the dealer paid for the vehicles purchased less the return on May 2.
5.On May 31,the dealer collected one-half of the amount due from the May 3 sale.
6.On May 31,the dealer paid the rent for the next month of $2,500.
Required:
Prepare the journal entries for the dealer during the month of May.Explanations are not required.

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The Answer of An auto dealer uses a perpetual inventory system.The dealer incurred the following transactions during the month of May:
1.On May 1,a dealer purchased 10 vehicles on account at $20,000 each,with credit terms of 2/10,net 30.
2.On May 2,the dealer returned one vehicle due to a product defect.
3.On May 3,the dealer sold 5 vehicles for $25,000 each on account to a local town.The credit terms were 3/10,net 30.
4.On May 9,the dealer paid for the vehicles purchased less the return on May 2.
5.On May 31,the dealer collected one-half of the amount due from the May 3 sale.
6.On May 31,the dealer paid the rent for the next month of $2,500.
Required:
Prepare the journal entries for the dealer during the month of May.Explanations are not required.

An Auto Dealer Uses a Perpetual Inventory System