Question

On March 12. Klein Company sold merchandise in the amount of $10.400 to Babson Company with credit terms of 210.n/30. The cost of the items sold is $5.800. Klein uses the perpetual Inventory system and the net method of accounting for sales. On March 15, Babson retums some of the merchandise, which is not defective. The selling price of the returned merchandise is $860 and the cost of the merchandise returned is $480. The entry or entries that Klein must make on March 15 is (are): Multiple Choice O 843 843 Sales returns and allowances Accounts receivable Merchandise inventory Cost of goods sold 480 486 O 843 Sales returns and allowances Accounts receivable Merchandise inventory Cost of goods sold 47e 476 0 Accounts receivable Sales returns and allowances 860 Accounts receivable Sales returns and allowances Cost of goods sold Merchandise inventory 480 O Sales returns and allowances Accounts receivable

Answer 1

The answer is

Sales returns and allowances	$843
Accounts receivable		$843
Merchandise inventory	$480
Cost of goods sold		$480