QS 5-13 Recording sales, returns, and allowances; no discounts P2 Prepare journal entries to record each of the following sales transactions of TFC Merchandising. TFC uses a perpetual inventory system and the gross method. May 1 Sold merchandise for $600, with credit terms 160 . The cost of the merchandise is $400. 9 The customer discovers slight defects in some units. TFC gives a price reduction (allowance) and credits the customer's accounts receivable for $40 to compensate for the defects. June 4 The customer in the May I sale returned $75 of merchandise for full credit. The merchandise, which had cost $50, is returned to inventory. 30 Received payment for the amount due from the May I sale less the May 9 allowance and June 4 return