Required Information Use the following information for the Exercises 6-8 below. (Algo) The following information applies to the questions displayed below) Allied Merchandisers was organized on May 1. Macy Co. 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 $8 cash per unit (for a total cost of $16,000). 5 Allied sold 1,000 of the units in inventory for $12 per unit (invoice total: $12,000) to Macy Co. under credit terms 2/10, n/60. The goods cost Allied $8,090. 7 Macy returns 100 units because they did not fit the customer's needs (invoice amount: $1,200). Atlied restores the units, which cost $800, to its inventory. 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 $400 to compensate for the damage. 15 Allied receives payment from Macy for the anount owed on the May 5 purchase; paynent is net of returns, allowances, and any cash discount. Exercise 4-6 (Algo) Recording sales, sales returns, and sales allowances LO P2 Prepare journal entries to record the following transactions for Allied assuming it uses a perpetual inventory system and the gross method Answer is complete but not entirely correct. Debit No Credit General Journal Date 1 Cash > 16,000 2 May 05 Accounts receivable 12,000 Sales 12,000 3 May 05 Cost of goods sold Merchandise inventory > 8,000 8,000 4 May 07 Sales returns and allowances Accounts receivable 1.200 0 1,200 5 May 07 800 Merchandise inventory Cost of goods sold pl 800 6 May 08 400 Sales returns and allowances Accounts receivable DO 400 7 May 15 Cash Sales discounts Accounts receivable 11,368 232 OO 10,800