On March 12, Klein Company, Inc. sold merchandise in the amount of $7,800 to Babson Company, with credit terms of 2/10, n/30. The cost of the items sold is $4,500. Klein uses the perpetual inventory system. On March 15, Babson returns some of the merchandise. The selling price of the returned merchandise is $600 and the cost of the merchandise returned is $350. The entry or entries that Klein must make on March 15 is:

Sales returns and allowances 600

Accounts receivable 600

Merchandise inventory 350

Cost of goods sold 350

Sales returns and allowances 600

Accounts receivable 600

Accounts receivable 600

Sales returns and allowances 600

Accounts receivable 600

Sales returns and allowances 600

Cost of goods sold 350

Merchandise inventory 350

Sales returns and allowances 350

Accounts receivable 350

Answer rating: 100% (QA)

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