Galaxy Company sold merchandise costing $3,100 for $5,200 cash. The merchandise was later returned by the customer for a refund. The company uses the perpetual inventory system. What effect will the sales return have on the financial statements
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Ответ:
1. Balance Sheet
Cash decrease $5,200
Merchandise increase $3,100
2. Income Statement
Sales Revenue decrease $5,200
Cost of Sales decrease $3,100
Explanation:
When the Merchandise was sold, the Journal Entries were as follows :
Cash $5,200 (debit)
Cost of Goods Sold $3,100 (debit)
Sales Revenue $5,200 (credit)
Merchandise $3,100 (credit)
When the Merchandise was returned, the journal entries were :
Sales Revenue $5,200 (debit)
Merchandise $3,100 (debit)
Cash $5,200 (credit)
Cost of Goods Sold $3,100 (credit)
The Effect on Financial Statement would be :
1. Balance Sheet
Cash decrease $5,200
Merchandise increase $3,100
2. Income Statement
Sales Revenue decrease
Cost of Sales decrease $3,100
Ответ:
C
Explanation: PLATO USERS ONLY