Sydney Retailing (buyer) and Troy Wholesalers (seller) enter into the following transactions. May 11 Sydney accepts delivery of $40,000 of merchandise it purchases for resale from Troy: invoice dated May ii, terms 3/10, n/90, FOB shipping point. The goods cost Troy $31,600. Sydney pays $300 cash to Express Shipping for delivery charges on the merchandise. May 12 Sydney returns $1,000 of the $40,600 of goods to Troy, who receives then the same day and restores then to its inventory. The returned goods had cost Troy $775. May 20 Sydney pays Troy for the amount owed. Troy receives the cash immediately. (Both Sydney and Troy use a perpetual inventory system and the net method.) 2. Prepare journal entries that Troy Wholesalers records for these transactions. View transaction list View journal entry worksheet X Debit Credit 40,000 40,000 31,000 31,000 Record the merchandise sold on account Record the cost of goods sold. Record the sales return Record the cost of sales return. Record the cash collected for credit sales. 1,000 1.000 775