Lockern Co. records estimated future sales returns and allowances. Total sales amount to $1,550,000, and, in the past, sales returns and allowances have been 2 1/2% of sales. 

 

Required: Prepare journal entries to:

a.	Record the estimated sales returns and allowances.
b.	Record the return of $1,000 of defective furniture.

129.Movie Set Up Company's trial balance before adjustment included the following information:

?	?	Debit	Credit
?	Accounts receivable	$1,245,000	?
?	Allowance for doubtful accounts	18,245	?
?	Sales	?	$10,510,000
?	Sales returns and allowances	48,000	?

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Prepare journal entries assuming that the estimate of uncollectible is determined by taking:

(1) 3.5% of gross accounts receivable

(2) 0.5% of net sales.

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