flower garden sells natural supplements to customers with an unconditional right of return if they are...

flower garden sells natural supplements to customers with an unconditional right of return if they are not satisfied. The right of return extends 60 days. On February 10, 2021, a customer purchases $6,000 of products (cost $3,000) on account. Based on its prior experience, flower garden estimates returns will be 15%. On April 5, 2021, the customer returns $400 of merchandise.

Prepare the necessary journal entries to record the transactions on February 10, 2021, and April 5, 2021.

Expert Solution

Journal Entries
Sr. No.	Date	Account Title	Debit	Credit

1	Feb 10. 2021	Account Receivable	$ 6,000
		Sales Revenue		$ 6,000
		(To Record the sales Revenue )

2	Feb 10. 2021	Cost of Goods Sold	$ 3,000
		Inventory		$ 3,000
		(To record the cost of Goods Sold)

3	Feb 10. 2021	Sales Return and Allowances ($ 6000 X 15%)	$ 900
		Account Receivable		$ 900
		(To record the estimation of return)

4	Feb 10. 2021	Returned Inventory	$ 400
		Cost of Goods Sold		$ 400
		(To Record the actual Return)

ekkarill92 answered 2 years ago

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