Answer:
Apr. 1
J1
Trade Receivable $6,600 (debit)
Sales Revenue $6,600 (credit)
J2
Cost of Sales $3,960 (debit)
Merchandise $3,960 (credit)
Apr. 4
J1
Sales Revenue $740 (debit)
Trade Receivable $740 (credit)
J2
Merchandise $444 (debit)
Cost of Sales $444 (credit)
Apr. 8
J1
Trade Receivable $2,800 (debit)
Sales Revenue $2,800 (credit)
J2
Cost of Sales $1,960 (debit)
Merchandise $1,960 (credit)
Apr. 11
Cash $5,860 (debit)
Trade Receivable (credit)
Explanation:
Perpetual method of inventory keeps a record of cost of inventory after every sale.
Thus, for every sale transaction remember to recognize the Sales Revenue and the Cost of Sales that follow the sale.
For any returns, De-recognize the Sales Revenue - to the extend of the <em>credit granted</em> and also de-recognize the Cost of Sales to the extend of the <em>value of Inventory returned</em>.
