Prepare journal entries to record sales

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Question - A Company started business in March 20xx. Sales for the first year totaled P4,000,000. The entity priced its merchandise to yield a 40% gross profit based on sales.

Industry statistics suggest that 10% of the merchandise Boy to customers will be returned.

The entity estimated sales returns based on the indut average During the year, customers return goods with sale price of P300,000.

Required - Prepare journal entries to record sales, sales returns and the year-end adjusting entry for estimated sales returns?

Reference no: EM132733663

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