Exercise $7-9($Algo$)$ Sales returns $[$L$07-4]$

Halifax Manufacturing allows its customers to return merchandise for any reason and receive a credit to their accounts. All of Halifax's sales are for credit $($no cash is collected at the time of sale$).$ The company began $2024$ with a refund liability of $$400,000.$ During $2024,$ Halifax sold merchandise on account for $$13,400,000.$ Halifax's merchandise costs are $65\%$ of merchandise selling price. Also during the year, customers returned $$661,000$ in sales for credit, with $$365,000$ of those being returns of merchandise sold prior to $2024,$ and the rest being merchandise sold during $2024.$ Sales returns, estimated to be $5\%$ of sales, are recorded as an adjusting entry at the end of the year.

Required:

Prepare entries to $($a$)$ record actual returns in $2024$ of merchandise that was sold prior to $2024$; $($b$)$ record actual returns in $2024$ of merchandise that was sold during $2024$; and $($c$)$ adjust the refund liability to its appropriate balance at year end.

What is the amount of the year$-$end refund liability after the adjusting entry is recorded?

Answer is not complete.

Complete this question by entering your answers in the tabs below.

Required $1$

Prepare entries to $($a$)$ record actual returns in $2024$ of merchandise that was sold prior to $2024$; $($b$)$ record actual returns in $2024$ of merchandise that was sold during $2024$; and $($c$)$ adjust the refund liability to its appropriate balance at year end.

Note: If no entry is required for a transaction$/$event$,$ select $"$No journal entry required" in the first account field.

Show less $4$

$\backslash$table$[[$No$,$Year,General,,Debit,Credit$],[1,2024,$Refund liability,$,,],[,$Accounts receivable,$,,],[2,2024,$Inventory,$,237,250ox,],[,$Inventory$$estimated returns,$,,237,250],[3,2024,$Sales returns,$,296,000vv,],[,$Accounts receivable,$,,296,000vv$ Required information

Exercise $7-5($Algo$)$ Trade and cash discounts; the gross method and the net method

compared $[$LO$7-3]$

$[$The following information applies to the questions displayed below.$]$

Tracy Company, a manufacturer of air conditioners, sold $100$ units to Thomas Company on

November $17,2024.$ The units have a list price of $$800$ each, but Thomas was given a $25\%$ trade

discount. The terms of the sale were $\frac{2}{10},\frac{n}{30}.$

Exercise $7-5($Algo$)$ Part $3$

$3-$a$.$ Prepare the journal entries to record the sale on November $17($ignore cost of goods$)$ and collection on November

$26,2024,$ assuming that the net method of accounting for cash discounts is used.

$3-$b$.$ Prepare the journal entries to record the sale on November $17($ignore cost of goods$)$ and collection on

December $15,2024,$ assuming that the net method of accounting for cash discounts is used.

Complete this question by entering your answers in the tabs below.

Prepare the journal entries to record the sale on November $17($ignore cost of goods$)$ and collection on November $26,2024,$

that the net method of accounting for cash discounts is used.

Note: If no entry is required for a transaction$/$event$,$ select $"$No journal entry required" in the first account field.

Journal entry worksheet

Record the sale of $100$ units with a list price of $$800,$ a $25\%$ trade discount $($if

applicable$),$ with terms of $\frac{2}{10},\frac{n}{30}$ under the net method.

Note: Enter debits before credits.

Record the cash collection on November $26.$

Record the sale of $100$ units with a list price of $$800,$ a $25\%$ trade discount $($if applicable$),$ with terms of $2/10,$ n$/30$ under the net method.

Record the cash collection on December $15.$