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Allied Merchandisers was organized on May $1.$ Macy Company is a major customer $($buyer$)$ of Allied $($seller$)$ products.

May $3$ Allied made its first and only purchase of inventory for the period on May $3$ for $2,000$ units at a

price of $$10$ cash per unit $($for a total cost of $$20,000).$

May $5$ Allied sold $1,000$ of the units in inventory for $$14$ per unit $($invoice total: $$14,000)$ to Macy Company

under credit terms $\frac{2}{10},\frac{n}{60}.$ The goods cost Allied $$10,000.$

May $7$ Macy returns $100$ units because they did not fit the customer's needs $($invoice amount: $$1,400).$ Allied

restores the units, which cost $$1,000,$ to its inventory.

May $8$ Macy discovers that $100$ units are scuffed but are still of use and, therefore, keeps the units.

Allied gives a price reduction $($allowance$)$ and credits Macy's accounts receivable for $$600$ to

compensate for the damage.

May $15$ Allied receives payment from Macy for the amount owed on the May $5$ purchase; payment is net of

returns, allowances, and any cash discount.

Use the above informations, analyze each transaction by indicating its effects on the income statement$-$specifically, identify the

accounts and amounts $($including $+$ or $-)$ for each transaction.