EX 6-21 Customer refunds and allowances OBJ. 2,3 Zell Company had sales of $1,800,000 and related cost of merchandise sold of $1,150,000 for its first year of operations ending December 31, 20Y3. Zell Company provides customers refunds and allowances for any damaged merchandise. At the end of the year, Zell Company estimates that customers will request refunds and allowances for 1.5% of sales. Assume that on February 3, 20Y4, Zell Company paid a customer a $5,000 cash refund for damaged merchandise. (a) Journalize the adjusting entry on December 31, 20Y3, to record the expected customer refunds and allowances. (b) Journalize the entry to record the cash refund.

EX 6-21 Customer refunds and allowances OBJ. 2, 3 Zell Company had sales of $1,800,000 and related cost of merchandise sold of $1,150,000 for its first year of operations ending December 31, 20Y3. Zell Company provides customers refunds and allowances for any damaged merchandise. At the end of the year, Zell Company estimates that customers will request refunds and allowances for 1.5% of sales. Assume that on February 3, 20Y4, Zell Company paid a customer a $5,000 cash refund for damaged merchandise. (a) Journalize the adjusting entry on December 31,20Y3, to record the expected customer refunds and allowances. (b) Journalize the entry to record the cash refund