Question

Recording Customer Deposits In 2020, Neighbor Co-Op Inc. sells 1,350 beverages in glass bottles and receives a $1.00 deposit for each returnable bottle sold. As of December 31, 2020, a total of 1,080 glass bottles were returned and deposits on 162 bottles were forfeited because it is the company's policy that a deposit must be claimed within 30 days. The remaining 108 bottles are still with customers within the 30-day claim period. Required a. Record the collection of deposits in 2020. b. Record the return of glass bottles in 2020. c. Record the forfeiture of deposits in 2020 assuming that the cost of each bottle is $0.80.

Answer 1

Cash        A/c                 Dr.	1350
To Drum Trade A/c		1350
Drum Trade A/c            Dr.	1080
To Cash A/c		1080
Drum Trade A/c                  Dr	32.4
To P&L		32.4
To record forfieture of Deposit
Drum Trade A/c                  Dr	129.6
To Cash A/c		129.6
To adjust inventory

for any query ask in comment, Please Rate my answer. Thank you for your thumbs up rating