On March 12, Klein Company, Inc. sold merchandise in the amount of $7,800 to Bab

Question

On March 12, Klein Company, Inc. sold merchandise in the amount of $7,800 to Babson Company, with credit terms of 2/10, n/30. The cost of the items sold is $4,500. Klein uses the perpetual inventory system. On March 15, Babson returns some of the merchandise. The selling price of the returned merchandise is $600 and the cost of the merchandise returned is $350. The entry or entries that Klein must make on March 15 is:

Sales returns and allowances 600   Accounts receivable 600 Merchandise inventory 350   Cost of goods sold 350

Explanation / Answer

When Customer returned the Goods Journal Entry would be

Sales Returns and Allowances A/c DR 600

Accounts Receivable 600

Inventory A/c DR 350

Cost of Goods Sold A/c 350

Related Questions

Navigate

• Browse (All)
• Browse O
• Subjects

---

---

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.