QUESTION 1 On July 1, ABC Company sold goods to XYZ Company for $10,000 on account, terms 2/10,n/30, FOB shipping point. Cost of the merchandise sold was $7,000. ABC records transactions using the net method and maintains its inventory records on a perpetual basis. 1. Prepare the journal entry to record this transaction for ABC Company 2. On July 5, XYZ returned $1,000 of merchandise to ABC. The cost of the merchandise returned was $700. Prepare the entry to record this transaction for ABC. 3. On July 29, ABC received payment from XYZ for the balance due. Record the collection by ABC