Ask Question
28 June, 19:17

Dogs R US uses the perpetual inventory system to account for its merchandise. A customer returned merchandise. Assuming that the purchase was originally bought on credit for $400 with a cost to Dogs R US of $100, demonstrate the required journal entry of Dogs R US.

Debit Sales Returns/Allowances $400

Credit Accounts Receivable $400

Debit Merchandise Inventory $100

Credit Cost of Goods Sold $100

+3
Answers (1)
  1. 28 June, 21:07
    0
    The journal entries are shown below:

    1. Sales return and Allowances A/c Dr $400

    To Account receivable A/c $400

    (Being the returned inventory is recorded)

    2. Merchandise inventory A/c Dr $100

    To Cost of Goods sold A/c $100

    (Being the cost of inventory is recorded)

    Since the merchandise inventory is returned for $400 and the same is recorded and together with the cost of the merchandise inventory is also recorded
Know the Answer?
Not Sure About the Answer?
Get an answer to your question ✅ “Dogs R US uses the perpetual inventory system to account for its merchandise. A customer returned merchandise. Assuming that the purchase ...” in 📙 Business if there is no answer or all answers are wrong, use a search bar and try to find the answer among similar questions.
Search for Other Answers