Question

1. Concord Publishing Co. publishes college textbooks that are sold to bookstores on the following terms. Each title has a fixed wholesale price, terms f.o.b. shipping point, and payment is due 60 days after shipment. The retailer may return a maximum of 30% of an order at the retailer’s expense. Sales are made only to retailers who have good credit ratings. Past experience indicates that the normal return rate is 12%. The costs of recovery are expected to be immaterial, and the textbooks are expected to be resold at a profit. On July 1, 2020, Concord shipped books invoiced at $12,800,000 (cost $10,240,000). Prepare the journal entry to record this transaction. (Credit account titles are automatically indented when amount is entered. Do not indent manually.If no entry is required, select "No entry" for the account titles and enter 0 for the amounts.)

2. On October 3, 2020, $1,280,000 of the invoiced July sales were returned according to the return policy, and the remaining $11,520,000 was paid. Prepare the journal entries for the return and payment. (Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No entry" for the account titles and enter 0 for the amounts.)

3. Assume Concord prepares financial statements on October 31, 2020, the close of the fiscal year. No other returns are anticipated. Indicate the amounts reported on the income statement and balance related to the above transactions. (If answer is 0, please enter 0. Do not leave any fields blank.)

Answer 1

Date	particulars	debit	credit
july-1-20	Accounts Receivable	12,800,000
	Sales Revenue		12,800,000
	To Recogine Revenue
	Cost of Goods Sold	10,240,000
	Inventory		10,240,000
	To Record Cost Of Goods
2)
Oct-3-20	Sales Return and Allowances	1,280,000
	Accounts Receivable		1,280,000
	To record the return
	Inventory	1,024,000		=10,240,000/12,800,000*1,280,000
	Cost of goods sold		1,024,000
	To record cost of goods returned
	Cash	11,520,000
	Accounts Receivable		11,520,000
	To record payment
	Income Statement(Partial)
	For the year ended October 31,2020
Sales		12,800,000
Less: Sales Return and Allowances	1,280,000
Net sales		11,520,000
Cost of goods Sold	9,216,000		Cost of goods sold = 10,240,000-1,024,000 = $9,216,000
Gross Profit	2,304,000
	Balannce Sheet(Partial)
	October 31,2020
Accounts Receivable	0
Inventory		1,024,000

if any dount please ention in comment