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mela Job Description Cloud Bing Yahoo Google Wkipedia Facebook Twitter Lnkedi women's sw. shop hearts Connect Help Save & ExitSubmit Check my work Exercise 7-8 Sales returns [LO7-4) Halifax Manufacturing allows its customers to return merchandise for any reason up to 90 days after delivery and receive a credit to their accounts. All of Halifax's sales are for credit (no cash is collected at the time of sale). The company began 2018 with an allowance for sales returns of $360,000. During 2018, Halifax sold merchandise on account for S12.100,000. This merchandise cost Halifax S8470,000 (70% of selling prices). Also anng the year, customers returned S 594,000 in sales for credit. Sales returns, estimated to be 5% of sales, are recorded as an adjusting entry at the end of the year Required: 1. Prepare an entry to record actual merchandise returns as they occur (not adjusting the allowance for sales returns) and then record a year-end entry to adjust the allowance for sales returns to its appropriate balance. 2. What is the amount of the year-end allowance for sales returns after the adjusting entry is recorded? Complete this question by entering your answers in the tabs below. Required 1 Required 2 Prepare an entry to record actual merchandise returns as they occur ( not adjusting the allowance for sales returns), and thenExplanation / Answer
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year Genearl Journal Dr Cr 2018 Sales Return $594,000 1 Accounts Receivable $594,000 (being actual sales return recorded) 2 Inventory $415,800 Cost of Good sold $415,800 (594000*70%) (record the return of mercandise to stock) 3 Sales return 11000 Allowance for Sales Return 11000 (5%*12100000)-594000 4 Inventory $7,700 Cost of Good sold $7,700 (11000*70%) (record the return of mercandise to stock)Related Questions
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