Making journal entries for the proceeds from by-product sales according to two methods. The Harmon Company produces seed. Screenings are sold to a garden outlet to be used in mulch products. During the month of May 19X4, screenings with an estimated value of $1,250 were removed from factory operations and stored in a warehouse. In June, the materials were sold for $1,180. Give the general journal entries to record these facts if the following procedures are used:

a. The company treats proceeds from the sale as miscellaneous income at the time of sale.

b. The company treats the estimated value of its by-products as a reduction in the cost of the main product at the time of removal.