On 4 June 20X1, a company sold $14,000 worth of goods, with a product cost of $9.000. The contract includes a return provision for 60 days. The company has no experience with returns with this customer type, and as a result, revenue is not recognized. At the end of the return period, the customer returns 5% of the goods. The goods can be re-sold to another customer. Required: Prepare the journal entries for inventory both on the date of sale and at the end of the return period. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.) View transaction list
On 4 June 20X1, a company sold $14,000 worth of goods, with a product cost of $9.000. The contract includes a return provision for 60 days. The company has no experience with returns with this customer type, and as a result, revenue is not recognized. At the end of the return period, the customer returns 5% of the goods. The goods can be re-sold to another customer. Required: Prepare the journal entries for inventory both on the date of sale and at the end of the return period. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.) View transaction list
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Question
Subject: acounting
Transcribed Image Text:On 4 June 20X1, a company sold $14,000 worth of goods, with a product cost of $9.000. The contract includes a return provision for
60 days. The company has no experience with returns with this customer type, and as a result, revenue is not recognized. At the end
of the return period, the customer returns 5% of the goods. The goods can be re-sold to another customer.
Required:
Prepare the journal entries for inventory both on the date of sale and at the end of the return period. (If no entry is required for a
transaction/event, select "No journal entry required" in the first account field.)
View transaction list
Journal entry worksheet
2
Prepare the journal entry at the time of sale:
Note: Enter debits before credits
Transaction
General Journal
Debit
Credit
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