Engine Central had the following sales transactions in December: Dec. 4. 7 Sold $7,700 of merchandise on account to Mo's Motors, terms 4/15, net 30. Cost $3,850. Mo returned $1,200 of merchandise to Engine Central because he changed his mind and wanted to order a different type of engine. Cost $600. Mo paid the balance owing to Engine Central. 16 Prepare the journal entries to record the sales transactions on the books of Engine Central using a perpetual inventory system and the earnings approach for revenue recognition. (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.) Date Account Titles and Explanation Debit Credit Dec. 4 Merchandise Inventory 7,700 Accounts Payable 7,700 (To record sales on account.) Cost of Goods Sold 3,850 1,200 Cost of Goods Sold 3,850 1,200 Merchandise Inventory 3,8501,200 (To record cost of goods sold.) Dec. 7 Sales Returns and Allowances 1,200 Accounts Receivable 1,200 (To record sales return.) Merchandise Inventory 600 Cost of Goods Sold 600 (To record cost of goods returned.) Dec. 16 Accounts Receivable Prepare the journal entries to record the sales transactions on the books of Engine Central using a periodic inventory system and the earnings approach for revenue recognition. (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.) Date Account Titles and Explanation Debit Credit Dec. 4 (To record sales on account.) Dec. 7 (To record sales return.) Dec. 16 (To record sales on account.) Dec. 7 (To record sales return.) Dec. 16