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$-11$

Ivanhoe Company sells $430$ units of its products for $$20$ each to Metlock Inc. for cash. Ivanhoe allows Metlock to return any unused product within $30$ days and receive a full refund. The cost of each product is $$13.$ To determine the transaction price, Ivanhoe decides that the approach that is most predictive of the amount of consideration to which it will be entitled is the probability$-$weighted amount. Using the probability$-$weighted amount, Ivanhoe estimates that $(1)12$ products will be returned, and $(2)$ the returned products are expected to be resold at a profit.

Prepare the journal entries for Ivanhoe at the time of the sale to Metlock including any expected returns. The company follows IFRS. $($Credit account titles are automatically indented when the amount is entered. Do not indent manually. If no entry is required, select $"$No Entry" for the account titles and enter $"$O$"$ for the amounts. List all debit entries before credit entries.$)$

Account Titles and Explanation

Debit

Credit

$$

$$

$$

$$

$$

$$

$$

$($To record cash sale$)$

$$

$$

$$

$$

$$

$$

$($To record cost of goods sold$)$