Business, 13.12.2019 01:31, 3ittylilbiddy3

Halifax manufacturing allows its customers to return merchandise for any reason up to 90 days after delivery and receive a credit to their accounts. all of halifax's sales are for credit (no cash is collected at the time of sale). the company began 2021 with a refund liability of $380,000. during 2021, halifax sold merchandise on account for $12,300,000. halifax's merchandise costs it 70% of merchandise selling price. also during the year, customers returned $603,000 in sales for credit, with $333,000 of those being returns of merchandise sold prior to 2021, and the rest being merchandise sold during 2021. sales returns, estimated to be 5% of sales, are recorded as an adjusting entry at the end of the year.
required:
1. prepare entries to:
(a) record actual returns in 2021 of merchandise that was sold prior to 2021.
b. record actual returns in 2021 of merchandise that was sold during 2021; and (c) adjust the refund liability to its appropriate balance at year end.
2. what is the amount of the year-end refund liability after the adjusting entry is recorded?

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Halifax manufacturing allows its customers to return merchandise for any reason up to 90 days after...