On jan. 3, gourmet cakes sold $15,000 of merchandise on account to jerry hines. on jan. 10, jerry returned $2,000 of the merchandise because they bought too much. assuming the cost of the returned merchandise to gourmet cakes was $500 and they use a perpetual inventory system, the journal entry on jan. 10, to record the return of the merchandise from jerry hines, would be:

sales returns & allowance     2,000 debit

            accounts receivables              2,000 credit

Inventory                                    500 debit

             COGS                                        500 credit

-to record the return of goods from Jerry Hines--

Explanation:

As the returned goods are not reported as failure or malfunction just; the customer returned as exceeds his needs, we can return them to goods ready to sale thus; inside inventory account.

We will decrease the account receivable, our COGS and increase our inventory

d) social security number

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