Question
Focus on what it says at the end, especially. On June 3, 2014, Hunt Company sold to Ann Mount merchandise having a sales price of
Focus on what it says at the end, especially.
On June 3, 2014, Hunt Company sold to Ann Mount merchandise having a sales price of $8,000 (cost $5,600) with terms of 2/10, n/60, f.o.b. shipping point. Hunt estimates that merchandise with a sales value of $800 will be returned. An invoice totaling $120, terms n/30, was received by Mount on June 8 from Olympic Transport Service for the freight cost. Upon receipt of the goods, on June 5, Mount notified Hunt that $300 of merchandise contained flaws. The same day, Hunt issued a credit memo covering the defective merchandise and asked that it be returned at Hunt's expense. Hunt estimates the returned items to have a fair value of $120. The freight on the returned merchandise was $24, paid by Hunt on June 7. On June 12, the company received a check for the balance due from Mount.
Show your work of how they got 120, 90, and 210 respectively.
Returned Inventory *............................................. 120
Loss due to Damaged Inventory.................... ....... 90
Estimated Inventory Returns.................. 210
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