Question

on September 12, ryan

On September 12. Ryan Company sold merchandise in the amount of $5.00 Jouson Company with credits 2 /10. 30. The cost of the items sold is $4.000 Myanuses the periode inventory System and the net method of accounting for sale on September 14. Johns return some of the non-defective merchandise which is restored to inventory. These price of the returned merchandis 500 and the cost of the merchandise returned is the entry or entries that Ryan must make on September 14 is (are Sales returns and a lowance les returns and allowana es returns and

Answer 1

c.

sales returns and allowances	490
...........to accounts receivable a/c		490

amount of sales returns will be = selling price *(1- discount rate)...........(since net method is used).

=>500*(1-0.02)

=>490.

Since periodic method is used, there is no need to record cost of goods sold.