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On April 2, 2021, Ivanhoe Company entered into a contract to supply medication to Laxall Drug Stores, FOB shipping point terms 2/30, n/45. The selling price of the medication is $60,000 and the medication cost Ivanhoe Company $20,000. Ivanhoe has a stated return policy that goods may be returned within 30 days. The medication was shipped on April 10, 2021. Ivanhoe's management estimates returns using the expected value method and sales discounts are estimated using the most likely outcome. Based on past experience with this product returns are 5% of sales 50% of the time, 10% of sales 20% of the time, and 20% of sales 30% of the time. Laxall Drug Stores will most likely pay within the discount period. Ivanhoe Company uses the contract-based approach for revenue recognition Calculate the transaction price. $ Transaction price List of Accounts trims to recognize revenue on the appropriate date. (Hint: The expected value method is also used to determine Prepare journal entries to recognize revenue on the appropriate date. (Hint: The expected value method is also used to determine the amount for cost of goods sold and estimated inventory returns.) (Credit account titles are automatically indented when the amount is entered. Do not indent manually. Record journal entries in the order presented in the problem. If no entry is required, select "No Entry" for the account titles and enter for the amounts.) Credit Debit Account Titles and Explanation (To record sales on account.) (To record sales on account.) (To record cost of goods sold.)

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