exercise 4-4 Recording sales, sales returns, and sales allowances LO P2

pts) Saved Help Save & Exit = my work mode : This shows what is correct or incorrect for the work you have completed so far. It does not indicate completi Return to ! Required information Use the following information for the Exercises below. [The following information applies to the questions displayed below.) Allied Merchandisers was organized on May 1. Macy Co. is a major customer (buyer) of Allied (seller) products. May 3 Allied made its first and only purchase of inventory for the period on May 3 for 2,000 units at a price of $10 cash per unit (for a total cost of $20,000). 5 Allied sold 1,500 of the units in inventory for $14 per unit (invoice total: $21,000) to Macy Co. under credit terms 2/10, n/60. The goods cost Allied $15,000. 7 Macy returns 125 units because they did not fit the customer's needs (invoice amount: $1,750). Allied restores the units, which cost $1,250, to its inventory. 8 Macy discovers that 200 units are scuffed but are still of use and, therefore, keeps the units. Allied sends Macy a credit memorandum for $300 toward the original invoice amount to compensate for the damage. 15 Allied receives payment from Macy for the amount owed on the May 5 purchase; payment is net of returns, allowances, and any cash discount. Exercise 4-4 Recording sales, sales returns, and sales allowances LO P2 Prepare journal entries to record the following transactions for Allied assuming it uses a perpetual inventory system and the gross method. (Allied estimates returns using an adjusting entry at each year-end.) Prey 1 2 of 8 Next > k my work mode : This shows what is correct or incorrect for the work you have completed so far. It does not indi Required information * Answer is not complete. No Date General Journal Debit Credit 1 May 03 Merchandise inventory Cash 20,000 20,000 2 2 May 05 Accounts receivable Sales 21,000 21,000 3 May 05 Cost of goods sold Merchandise inventory 4 May 07 Sales returns and allowances Accounts receivable 1,750 1,750 5 May 07 Merchandise inventory Cost of goods sold 1,250 1,250 Prey 1 2 2 of 8 Next > pts) i Saved Help eck my work mode : This shows what is correct or incorrect for the work you have completed so far. It does not indica I Required information Merchandise inventory 4 May 07 1,750 Sales returns and allowances Accounts receivable 1,750 5 May 07 > 1,250 Merchandise inventory Cost of goods sold 1,250 6 May 08 300 Sales returns and allowances Accounts receivable 300 7 May 15 Cash Sales discounts Accounts receivable CP Prev 1 2 of 8 Next >