On June 3, 2014, Hunt Company sold to Ann Mount merchandise having a sales price of $8,000 (cost $5,600) with terms of 2/10, n/60, f.o.b. shipping point. Hunt estimates that merchandise with a sales value of $800 will be returned. An invoice totaling $120, terms n/30, was received by Mount on June 8 from Olympic Transport Service for the freight cost. Upon receipt of the goods, on June 5, Mount notified Hunt that $300 of merchandise contained flaws. The same day, Hunt issued a credit memo covering the defective merchandise and asked that it be returned at Hunt's expenseHunt estimates the returned items to have a fair value of $120. The freight on the returned merchandise was $24, paid by Hunt on June 7. On June 12, the company received a check for the balance due from Mount.

Instructions

(a) Prepare journal entries for Hunt Company to record all the events noted above assuming sales and receivables are entered at gross selling price.

(b) Prepare the journal entry assuming that Ann Mount did not remit payment until August 5?