Prepare journal entries to record the following sales transactions in Ivanhoe Companys books. Ivanhoe uses a perpetual inventory system. Jan. 2 Ivanhoe sold $14,000 of merchandise to Xiaoyan Company, terms n/30, FOB shipping point. The cost of the merchandise sold was $5,530. 4 The correct company paid freight costs of $185. 6 Xiaoyan returned $1,500 of the merchandise purchased on January 2 because it was not needed. The cost of the merchandise returned was $590, and it was restored to inventory. Feb. 1 Ivanhoe received the balance due from Xiaoyan.