Problem: K Company sold inventory costing $1,400 on credit for the price of $2,000, with terms 2/10, n/30, FOB destination. The shipping cost of $100 was paid upon shipment of the goods. The buyer returned $250 of merchandise (retail price) prior to paying for the goods. Required: If K Company uses a perpetual inventory system: a. What is the journal entry recorded for the sale? b. What is the journal entry recorded for the shipping cost? c. What is the journal entry recorded for the return?

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Problem Details

K Company sold inventory costing $1,400 on credit for the price of $2,000, with terms 2/10, n/30, FOB destination. The shipping cost of $100 was paid upon shipment of the goods. The buyer returned $250 of merchandise (retail price) prior to paying for the goods.

Required: If K Company uses a perpetual inventory system:

a. What is the journal entry recorded for the sale?

b. What is the journal entry recorded for the shipping cost?

c. What is the journal entry recorded for the return?

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