Reference no: EM132740735
Question - Redo the question to check the answers. Next, fill in the missing amounts which are the blanks.
On June 3, 2017, Sheridan Company sold to Ann Mount merchandise having a sales price of $8,400 (cost $5,000) with terms of 2/10, n/60, f.o.b. shipping point. Sheridan estimates that merchandise with a sales value of $840 will be returned. An invoice totalling $140, terms n/30, was received by Mount on June 8 from Olympic Transport Service for the freight cost. Upon receipt of the goods, on June 5, Mount notified Sheridan that $600 of merchandise contained flaws. The same day, Sheridan issued a credit memo covering the defective merchandise and asked that it be returned at Sheridan's expense. Sheridan estimated the returned items to have a fair value of $310. The freight on the returned merchandise was $27, paid by Sheridan on June 7. On June 12, the company received a cheque for the balance due from Mount.
Required -
a) Make journal entries for Sheridan Company to record all the events noted above, assuming sales and receivables are entered at gross selling price.
b) Make the journal entry, assuming that Ann Mount did not remit payment until August 5.