Journal Entries by Transaction Type

This topic shows examples of journal entries for different transaction types for an item that would be sold at $100.00 retail with a $45.00 cost.

Sale                    DR | CR

Retail Sales                 100

Cash                  105

Tax                               5

Inventory                      45

COGS                 45

Return (normal)  DR | CR

Sales Returns       100

Cash                               105

Tax                          5

Inventory               45

COGS                             45

Return (defective) DR | CR

Sales Returns          100

Cash                                 105

Tax                             5

Inventory                  45

COGS                               45

House Charge (A/R)   DR | CR

Retail Sales                           100

Accounts Rec                105

Tax                                             5

Inventory                                   45

COGS                              45

House Charge (A/R) Return   DR | CR

Retail Sales                               100

Accounts Rec                                    105

Tax                                                5

Inventory                                      45

COGS                                                   45

Sale w/Rebate ($5)     DR  | CR

Retail Sales                            100

Cash                             105

Tax                                              5

Inventory                                    45

COGS                            45

Inventory                          5

(Rebate account you assigned)  5

Discounted Sale ($5) DR | CR

Retail Sales                         100

Sales Allowance              5

Cash                            100

Tax                                         5

Inventory                               45

COGS                           45

Purchase Order (normal)  DR | CR

Inventory                         45

Accounts Payable                     45

Purchase Order (credit)    DR | CR

Inventory                                  45

Accounts Payable            45

Purchase Order (defect)     DR | CR

Inventory                                   45

Accounts Payable              45

Inventory Adjustment   DR | CR

(shrinking a $20 item)

Inventory                                  20

Shrinkage                          20