I have solved most of this problem but need help with the sales returns and allowances/ accounts receivable on May 12. The question states to use a perpetual inventory system and the net method (not gross method). IT is also for Troy only!

Required information [The following information applies to the questions displayed below) Sydney Retailing (buyer) and Troy Wholesalers (seller) enter into the following transactions, May 11 sydney accepts delivery of $40, eee of merchandise it purchases for resale from Troy: Invoice dated May 11, terms 3/10, 1/90, FOB shipping point. The goods cost Troy $30,000. Sydney pays $345 cash to Express Shipping for delivery charges on the merchandise. May 12 Sydney returns $1,400 of the $40, eee of goods to Troy, who receives them the same day and restores then to its inventory. The returned goods had cost Troy $1,050. May 20 Sydney pays Troy for the amount owed. Troy receives the cash immediately. (Both Sydney and Troy use a perpetual inventory system and the net method) a Answer is complete but not entirely orrect. No Date General Journal Credit 1 May 11 Accounts receivable Sales Debit 38,800 38.800 2 May 11 Cost of goods sold Merchandise inventory 30,000 30,000 3 May 12 Sales returns and allowances Accounts receivable 37 592 37 592 May 12 Merchandise inventory Cost of goods sold 1,050 1,050 May 20 Cash Accounts receivable 37.442 37,442