On October $5,$ Flint Corporation buys merchandise for resale on account from Pina Colada Corporation. The selling price of the goods is $$4,740,$ and the cost to Pina Colada Company is $$2,980.$ Pina Cola Company expects a return rate of $15\%.$On October $8,$ Flint returns defective goods with a selling price of $$700$ and a cost of $$270.$ Pina Colada anticipates that these goods can be resold at a discount at some point in the future for at least their cost of $$270,$ if not more. Both companies use a periodic inventory system.