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On July 10, 2025, Cullumber Music sold CDs to retailers on account and recorded sales revenue of $644,000 (cost $502,320). Cullumber grants the right to return CDs that do not sell in 3 months following delivery. Past experience indicates that the normal return rate is 15%. By October 11, 2025, retailers returned CDs to Cullumber and were granted credit of $78,600. Prepare Cullumber's journal entries to record (a) the sale on July 10, 2025, and (b) $78,600 of returns on October 11, 2025, and on October 31, 2025. Assume that Cullumber prepares financial statements on October 31, 2025 and uses the gross method. (Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No entry" for the account titles and enter O for the amounts. List all debit entries before credit entries.) No. (a) Date July 10, 2025 (b) Oct. 11, 2025 Oct. 31, 2025 Account Titles and Explanation (To record sales) (To record cost of goods sold) (To record sales returns) (To record cost of goods returned) Debit Credi

On July 10, 2025, Cullumber Music sold CDs to retailers on account and recorded sales revenue of $644,000 (cost $502,320). Cullumber grants the right to return CDs that do not sell in 3 months following delivery. Past experience indicates that the normal return rate is 15%. By October 11, 2025, retailers returned CDs to Cullumber and were granted credit of $78,600. Prepare Cullumber's journal entries to record (a) the sale on July 10, 2025, and (b) $78,600 of returns on October 11, 2025, and on October 31, 2025. Assume that Cullumber prepares financial statements on October 31, 2025 and uses the gross method. (Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No entry" for the account titles and enter O for the amounts. List all debit entries before credit entries.) No. (a) Date July 10, 2025 (b) Oct. 11, 2025 Oct. 31, 2025 Account Titles and Explanation (To record sales) (To record cost of goods sold) (To record sales returns) (To record cost of goods returned) Debit Credi

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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On July 10, 2025, Cullumber Music sold CDs to retailers on account and recorded sales revenue of $644,000 (cost $502,320). Cullumber grants the right to return CDs that do not sell in 3 months following delivery. Past experience indicates that the normal return rate is 15%. By October 11, 2025, retailers returned CDs to Cullumber and were granted credit of $78,600. Prepare Cullumber's journal entries to record (a) the sale on July 10, 2025, and (b) $78,600 of returns on October 11, 2025, and on October 31, 2025. Assume that Cullumber prepares financial statements on October 31, 2025 and uses the gross method. (Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No entry" for the account titles and enter O for the amounts. List all debit entries before credit entries.) No. (a) Date July 10, 2025 (b) Oct. 11, 2025 Oct. 31, 2025 Account Titles and Explanation (To record sales) (To record cost of goods sold) (To record sales returns) (To record cost of goods returned) Debit Credi
Transcribed Image Text:On July 10, 2025, Cullumber Music sold CDs to retailers on account and recorded sales revenue of $644,000 (cost $502,320). Cullumber grants the right to return CDs that do not sell in 3 months following delivery. Past experience indicates that the normal return rate is 15%. By October 11, 2025, retailers returned CDs to Cullumber and were granted credit of $78,600. Prepare Cullumber's journal entries to record (a) the sale on July 10, 2025, and (b) $78,600 of returns on October 11, 2025, and on October 31, 2025. Assume that Cullumber prepares financial statements on October 31, 2025 and uses the gross method. (Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No entry" for the account titles and enter O for the amounts. List all debit entries before credit entries.) No. (a) Date July 10, 2025 (b) Oct. 11, 2025 Oct. 31, 2025 Account Titles and Explanation (To record sales) (To record cost of goods sold) (To record sales returns) (To record cost of goods returned) Debit Credi
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