Lima Company enters into a contract to sell $9,000 of merchandise, n/30. The cost of the merchandise to Lima is $4,500. Lima’s management uses the expected value method to estimate returns and has the following information from similar contracts: 45% of the time, returns are 15% of sales and 55% of the time, returns are 10% of sales. The performance obligation was completed on September 20.

(a) Calculate the transaction price for this sale assuming the company follows IFRS and uses the expected value method to estimate returns.

(b) Prepare the journal entry to record the sale, ignoring any entries required for estimated inventory returns, cost of goods sold, and merchandise inventory. (Round all amounts to the nearest dollar.)