As a merchandising company, Dolfin Corporation uses the perpetual inventory system. To prepare for this assignment, you have been asked to review your knowledge of sales and purchase transactions by completing the table below.

Consider the effect of each transaction on the three accounts listed, then use checkmarks to identify which accounts are debited or credited. If none of these accounts is affected by the transaction, check the No Effect box

	Merchandise Inventory		Estimated Returns Inventory		Cost of Merchandise Sold		No Effect
	Debit	Credit	Debit	Credit	Debit	Credit
Customer returns
Purchase of merchandise for resale
Payment of service fee for processing credit card sales
Yearly estimate for customer returns
Customer payment on account
Freight paid for sales with FOB destination
Freight paid for merchandise purchased FOB shipping point
Cash sale of merchandise
Return of merchandise purchased for resale
Sale on account For each observation, use checkmarks to identify which items on the income statement are overstated or understated. If none of these items is affected by the observation, check the No Effect box..