On July 10, 2022, Amodt Music sold CDs to retailers on account and recorded sales revenue of

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On July 10, 2022, Amodt Music sold CDs to retailers on account and recorded sales revenue of $700,000 (cost $560,000). Amodt grants the right to return CDs that do not sell in 3 months following delivery. Past experience indicates that the normal return rate is 15%. By October 11, 2022, retailers returned CDs to Amodt and were granted credit of $78,000. Prepare Amodt’s journal entries to record 

(a) The sale on July 10, 2022, 

(b) $78,000 of returns on October 11, 2022, 

(c) Any entry necessary on October 31, 2022. 

Assume that Amodt prepares financial statement on October 31, 2022.

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Related Book For  book-img-for-question

Intermediate Accounting IFRS

ISBN: 9781119607519

4th Edition

Authors: Donald E. Kieso, Jerry J. Weygandt, Terry D. Warfield

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