A Customer Returned Merchandise Purchased with Cash with a Sales

question 136

Multiple Choice

A customer returned merchandise purchased with cash with a sales price of $9,500.The cost of goods was $3,800.Which of the following represents the correct way to record this transaction?

• A) \[\begin{array} { | l | r | r | }
• \hline \text { Refunds Payable } & 9,500 & \\
• \hline \text { Sales Revenue } & & 9,500 \\
• \hline & & \\
• \hline \text { Merchandise Inventory } & 3,800 & \\
• \hline \begin{array} { l }
• \text { Estimated Returns } \\
• \text { Inventory }
• \end{array} & & 3,800 \\
• \hline
• \end{array}\]
• B) \[\begin{array} { | l | r | r | }
• \hline \text { Refunds Payable } & 9,500 & \\
• \hline \text { Cash } & & 9,500 \\
• \hline & & \\
• \hline \text { Merchandise Inventory } & 3,800 & \\
• \hline \begin{array} { l }
• \text { Estimated Returns } \\
• \text { Inventory }
• \end{array} & & 3,800 \\
• \hline
• \end{array}\]
• C) \[\begin{array} { | l | r | r | }
• \hline \text { Sales Revenue } & 9,500 & \\
• \hline \text { Cash } & & 9,500 \\
• \hline \\
• \hline \text { Merchandise Inventory } &3,800 & \\
• \hline \text { Cost of Goods Sold } & & 3,800\\
• \hline
• \end{array}\]
• D) \(\begin{array}{|l|l|l|}
• \hline\text { Sales Returns and } & & \\
• \text { Allowances } & 9,500 & \\
• \hline \text { Cash } & & 9,500 \\
• \hline & & \\
• \hline \text { Estimated Returns Inventory } & 3,800 & \\
• \hline \text { Merchandise Inventory } & & 3,800 \\
• \hline
• \end{array}\)

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Definitions:

Unbiased Conviction

A firm belief or opinion formed without prejudice or favoritism towards any side.

Industrial Products

Products sold primarily for use in producing other products.

Customer Service

The support and assistance provided by a company to the users of its products or services before, during, and after a purchase.

Product Guarantees

Promises made by the seller or manufacturer about the quality or lifespan of a product, providing assurance to the buyer.