Answer:
Explanation:
The journal entries are shown below:
On July 3
Account receivable A/c Dr $3,750
To Sales $3,750
(Being the goods are sold on credit)
Cost of goods sold A/c Dr $2,000
To Merchandise Inventory A/c $2,000
(Being goods are sold at cost)
On July 5
Sales return and allowance A/c Dr $1,050
To Accounts receivable $1,050
(Being sales return is recorded)
Merchandise Inventory A/c $610
To Cost of goods sold A/c Dr $610
(Being sales return is recorded)
On July 12
Cash A/c Dr $2,700 ($3,050 - $1,050)
To Accounts receivable $2,700
(Being cash is received)
On July 17
Cash A/c Dr $7,420
To Sales A/c $7,000
To Sales tax payable A/c $420 ($7,000 × 6%)
(Being the goods are sold on credit)
Cost of goods sold A/c Dr $3,830
To Merchandise Inventory A/c $3,830
(Being goods are sold at cost)
