Analyze each transaction in QS 4-11 by indicating its effects on the components of the income statement—specifically, identify the following six accounts and dollar effects (including + or −) for each transaction: sales (gross), sales discounts, sales returns and allowances, net sales, cost of goods sold, and gross profit.

Data from QS 4-11

Prepare journal entries to record each of the following sales transactions of EcoMart Merchandising. EcoMart uses a perpetual inventory system and the gross method.

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Oct. 1 6 9 30 Sold merchandise for $1,500, with credit terms n30, invoice dated October 1. The cost of the merchandise is $900. The customer in the October 1 sale returned $150 of merchandise for full credit. The merchandise, which had cost $90, is returned to inventory. Sold merchandise for $700 cash. Cost of the merchandise is $450. Received payment for the amount due from the October 1 sale less the return on October 6.