On July 10, 2020, Sheffield Music sold CDs to retailers on account and recorded sales...
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Accounting
On July 10, 2020, Sheffield Music sold CDs to retailers on account and recorded sales revenue of $724,000 (cost $528,520). Sheffield grants the right to return CDs that do not sell in 3 months following delivery. Past experience indicates that the normal return rate is 15%. By October 11, 2020, retailers returned CDs to Sheffield and were granted credit of $81,700. Prepare Sheffield's journal entries to record (a) the sale on July 10, 2020, and (b) $81,700 of returns on October 11, 2020, and on October 31, 2020. Assume that Sheffield prepares financial statement on October 31, 2020. (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 Ofor the amounts.) No. Date Account Titles and Explanation Debit Credi (a) (To record sales)
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