Accounting for Sales Transactions Kate Company uses the perpetual inventory system. Record the journal entries for the following transactions: a. On July 16, Kate sold $1,200 of merchandise with terms of 2/10, n/30. The cost of the merchandise was $720. b. On July 19, the customer returned $200 of the merchandise from (a). The cost of the merchandise was $120. c. On July 22, the customer paid the entire balance due to Kate. General Journal Description Ref. Debit Credit To record sale of merchandise. To record cost of merchandise sold. To record return of merchandise sold. To record cost of merchandise sold. Cash Check