JournaldrillSales return restocked
A journal entry exercise from Journaldrill. Solve it with an account picker and debit and credit fields in your browser, and it is checked the moment you submit.
The task
A customer returns a jacket that Cedar Lane Boutique sold on account for $420. The jacket cost Cedar Lane $250, is in perfect condition, and goes back on the shelf. The customer has not yet paid. Cedar Lane uses a perpetual inventory system.
What this exercise teaches
The $420 selling price is debited to Sales Returns and Allowances, a contra revenue account, and the customer's balance is reduced by crediting Accounts Receivable. Because the jacket is restocked, its $250 cost goes back into Inventory and Cost of Goods Sold is reduced by the same amount.
A hint if you get stuck
Undo the sale at its selling price through a contra revenue account, and undo the cost because the goods came back.
This exercise is part of Pro
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