Part I (12 marks) Norman Company sold 10 units of clothes in size M to a customer for $6,250 on credit (Gross Profit is 36%). Later on the customer found one of the units delivered was actually Size L and returned the wrong unit to Norman. Required: (a) If Norman Company uses a periodic inventory system, what journal entries would be made for the above transactions? (4 marks) (b) If Norman Company uses a perpetual inventory system. What journal entries would be made for the above transactions? (8 marks) Part II (17 marks) Forest Ltd. (Forest) uses a periodic inventory system. The Trial Balance of Forest as at 30 November 2019 shows the following information: DI $150,000 Inventory, as at 31 December 2018 Sales revenue Sales returns Purchases $1,850,000 $15.000 $634,750 During December, the following transactions took place: Dec 3 Dec 5 Dec 8 Forest purchased $250,000 inventory from Supplier A on credit. Forest sold goods to Kenny Corporation at the price of $100,000 on account, gross profit rate is 30%. Forest returned $30,000 inventory to Supplier A due to incorrect color of the goods. Forest sold goods to SiSi Corporation at $180,000 on credit, gross profit rate is 50%. Dec 10 Required: (a) Prepare journal entries for the above transactions, (8 marks) (b) On 31 December Forest conducted physical count of inventory and found $264,500 inventory was on hand. Prepare two closing entries to update Cost of Goods Sold and the Inventory Account (5 marks) (c) Compute gross profit in terms of (i) amount and (ii) percentage for the year. Show your workings. (4 marks)