Carla Ranch & Farm is a distributor of ranch and farm equipment. Its products range from small tools, power equipment for tranch- digging and fencing, grain dryers, and barn winches. Most products are sold direct via its company catalog and Internet site. However, given some of its specialty products, select farm implement stores carry Carla's products. Pricing and cost information on three of Carla's most popular products are as follows. Item Mini-trencher Standalone Selling Price (Cost) $3,200 ($2,200 1 Power fence hole auger Grain/hay dryer 1,200 (700 1 12,600 (11,600) Respond to the requirements related to the following independent revenue arrangements for Carla Ranch & Farm. (a) -Your answer is partially correct. On January 1, 2020, Carla sells 30 augers to Mills Farm & Fleet for $36,000. Mills signs a 6-month note at an annual interest rate of 12%. Carla allows Mills to return any auger that it cannot use within 50 days and receive a full refund. Based on prior experience, Carla estimates that 5% of units sold to customers like Mills will be returned (using the most likely outcome approach). Carla's costs to recover the products will be immaterial, and the returned augers are expected to be resold at a profit. Prepare the journal entry for Carla on January 1, 2020. (Credit account titles are automatically indented when the 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.) (b) Account Titles and Explanation Accounts Receivable Sales Revenue (To record sales) Cost of Goods Sold Inventory (To record cost of goods sold) eTextbook and Media List of Accounts Save for Later Your answer is partially correct. Debit 36000 36000 Credit 36000 36000 Attempts: 1 of 5 used Submit Answer On August 10, 2020, Carla sells 16 mini-trenchers to a farm co-op in western Minnesota on account. Carla provides a 456 volume discount on the mini-trenchers if the co-op has a 15% increase in purchases from Carla compared to the prior year. Given the slowdown in the farm economy, sales to the co-op have been flat, and it is highly unlikely that the benchmark will be met. Prepare the journal entry for Carla on August 10, 2020. (Credit account titles are automatically indented when the 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.) Account Titles and Explanation Debit Credit Accounts Receivable Sales Revenue (To record sales) Cost of Goods Sold Inventory