Selected transactions follow forDiscoverySports Ltd. during the company's first month of business. The company expects a return rate of 8% and uses a perpetual inventory system.

Feb. 2 Sold $1,140of merchandise to Andrew Noren on account, terms n/30. The goods had costDiscovery$765.

Feb 4 Andrew Noren returned for credit $90of the merchandise purchased on February 2. The goods had costDiscovery$60and they were returned to inventory.

Feb 5 Sold $760of merchandise to Dong Corporation on account, terms n/30. The goods had costDiscovery$490.

Feb 8 Sold $842of merchandise to Michael Collins for cash. The goods had costDiscovery$622.

Feb 10 Sold $920of merchandise to Rafik Kurji account, terms n/30. The goods had costDiscovery$680.

Feb 22 Dong Corporation paid its account in full.

Feb 24 Andrew Noren purchased an additional $696of merchandise on account, terms n/30. The goods had costDiscovery$410.

Feb 27 Sold $1,738of merchandise to Batstone Corporation, terms n/30. The goods had costDiscovery$1,105.

Feb 28 Andrew Noren paid $1,000on account.

(a) Set up T accounts for theAccounts Receivablegeneral ledger (control) account and for theaccounts receivablesubsidiary ledger accounts. Post the journal entries to these accounts.

(b) Prepare a list of customers and the balances of their accounts from the subsidiary ledger. Prove that the total of the subsidiary ledger balances is equal to the control account balance.