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Afina-wow [57]
2 years ago
15

Scott Company had sales of $12,350,000 and related cost of goods sold of $7,500,000. Scott provides customers a refund for any r

eturned or damaged merchandise. At the end of the year, Scott estimates that customers will request refunds for 0.8% of sales and estimates that merchandise costing $48,000 will be returned. Journalize the adjusting entries on December 31 to record the expected customer returns. Refer to the Chart of Accounts for exact wording of account titles.
Business
1 answer:
maria [59]2 years ago
4 0

The adjusting journal entries to record the adjustments in the books of Scott Company are as follows:

<h3>Journal Entries:</h3>

December 31;

Debit Sales $98,800

Credit Cash Refundable $98,800

  • To record expected cash refunds.

Debit Inventory $48,000

Credit Cost of goods sold $48,000

  • To record expected merchandise returns.

<h3>Data Analysis:</h3>

Sales = $12,350,000

Cost of goods sold = $7,500,000

Estimated percentage refunds = 0.8% of sales

Expected Refunds = $98,800 ($12,350,000 x 0.8%)

Returned goods = $48,000

Sales $98,800

Cash Refundable $98,800

Inventory $48,000

Cost of goods sold $48,000

Learn more about adjusting journal entries at brainly.com/question/13933471

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$2,500 - $155.80 = $2,348.20

The wages fall under the category of Over $1,631 but under $3,315

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<u>NOTE :</u> - the withholding allowance is deducted from the wages, the amount of single allowance is $155.80.

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