Botanic Choice sells natural supplements to customers with an unconditional sales refund if they are not satisfied. Sales returns are extended 60 days. On February 10, 2020, a customer purchases $90,000 of natural supplements (cost is 60% of sales) n/60 terms. Assuming that based on previous experience, the estimated returns are 15%. The company uses a perpetual inventory system.

A. Prepare the journal required to record actual returns of $9,000 on February 24, 2020.

B. Prepare the journal entry required to record estimated returns on March 31, 2020 when the Company prepares Financial Statements.

Answer rating: 100% (QA)

Journal Entries Transaction A i A ii B Particula... View the full answer