On January 25, 2016, Hanna Corporation shipped $25,000 of electrical supplies on consignment to Goshen Company. On January 26, 2016, Hanna paid freight costs of $120. On January 27, 2016, Goshen Corporation paid $475 for local advertising, which is reimbursable from Hanna. On March 31, 2016, 70% of the merchandise had been sold for $28,200. Goshen notified Hanna, retained 10% commission, and remitted the cash due to Hanna. Hanna uses a perpetual inventory system.

Required:

Prepare all the required journal entries on the books of Hanna Corporation. Specify the dates of the journal entries and omit explanations.

Prepare all the required journal entries on the books of Goshen Company. Specify the dates of the journal entries and omit explanations.

What is the amount of gross profit recognized by Hanna during the first quarter of 2016?