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Blossom Choice sells natural supplements to customers with an unconditional sales return if they are not satisfied. The sales returns period extends 60 days. On February 10, 2021, a customer purchases $2700 of products (cost $1350). Assuming that based on prior experience, estimated returns are 10%. The journal entry to record the actual return of $120 of merchandise includes a debit to Returned Inventory for $60. debit to Estimated Inventory Returns for $60. credit to Allowance for Sales Returns for $120. credit to Returned Inventory for $60

Blossom Choice sells natural supplements to customers with an unconditional sales return if they are not satisfied. The sales returns period extends 60 days. On February 10, 2021, a customer purchases $2700 of products (cost $1350). Assuming that based on prior experience, estimated returns are 10%. The journal entry to record the actual return of $120 of merchandise includes a debit to Returned Inventory for $60. debit to Estimated Inventory Returns for $60. credit to Allowance for Sales Returns for $120. credit to Returned Inventory for $60

FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Blossom Choice sells natural supplements to customers with an unconditional sales return if they are not satisfied. The sales returns period extends 60 days. On February 10, 2021, a customer purchases $2700 of products (cost $1350). Assuming that based on prior experience, estimated returns are 10%. The journal entry to record the actual return of $120 of merchandise includes a

debit to Returned Inventory for $60.
debit to Estimated Inventory Returns for $60.
credit to Allowance for Sales Returns for $120.
credit to Returned Inventory for $60.
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