Question

A seller uses a perpetual inventory system, and on April 17, a customer returns $1,000 of merchandise previously purchased on credit on April 13. The seller's cost of the merchandise returned was $480. The merchandise is not defective and is restored to inventory. The seller has not yet received any cash from the customer. Complete the two journal entries to record the return transaction by selecting the account names from the drop-down menus and entering the dollar amounts in the debit or credit columns.

Answer 1

Answer:

Explanation:

The journal entry is shown below:

On April 17

Sales return and allowance A/c Dr $1,000

          To Accounts receivable $1,000

(Being sales return is recorded)

Merchandise inventory A/c Dr $480

                  To Cost of goods sold A/c $480

(Being sales return is recorded)

Only these two entries are passed for returning the goods the first one is for sales and the second one is for the cost