On July 10, 2020, Blue Music sold CDs to retailers on account and recorded sales revenue of $636,000 (cost $496,080). Blue grants the right to return CDs that do not sell in 3 months following delivery. Past experience indicates that the normal return rate is 15%. By October 11, 2020, retailers returned CDs to Blue and were granted credit of $77,100.

Prepare Blue's journal entries to record (a) the sale on July 10, 2020, and (b) $77,100 of returns on October 11, 2020, and on October 31, 2020. Assume that Blue prepares financial statement on October 31, 2020. (Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No entry" for the account titles and enter 0 for the amounts.)

No.

Date Account Titles and Explanation Debit Credit

(a)

enter an account title to record sales on July 10, 2017 enter a debit amount enter a credit amount

enter an account title to record sales on July 10, 2017 enter a debit amount enter a credit amount

(To record sales)

enter an account title to record cost of goods sold on July 10, 2017 enter a debit amount enter a credit amount

enter an account title to record cost of goods sold on July 10, 2017 enter a debit amount enter a credit amount

(To record cost of goods sold)

(b)

enter an account title to record sales returns on October 11, 2017 enter a debit amount enter a credit amount

enter an account title to record sales returns on October 11, 2017 enter a debit amount enter a credit amount

(To record sales returns)

enter an account title to record cost of goods returned on October 11, 2017 enter a debit amount enter a credit amount

enter an account title to record cost of goods returned on October 11, 2017 enter a debit amount enter a credit amount

(To record cost of goods returned)

enter an account title to record the transaction on October 31, 2017 enter a debit amount enter a credit amount

enter an account title to record the transaction on October 31, 2017 enter a debit amount enter a credit amount