Record the following transactions for Lett Company. (Credit account titles are automatically indented when the amount is entered. Do not indent manually.) 1.On August 4, Lett sold merchandise on account to Smiley Company for $610, terms 2/10, n/30. 2.On August 7, Lett granted Smiley a sales allowance and reduced the cost of the merchandise by $60 because some of the goods were slightly damaged. 3.On August 12, Smiley paid the account in full.

The journal entries are shown below:

Explanation:

The journal entries are as follows

On August 4

Account Receivable   $610

    To Sales Revenue       $610

(Being the goods sold on credit basis is recorded)

On August 7

Sales Return and Allowances   $60

      To Accounts Receivable   $60

(Being the sales allowance is recorded)

On August 12

Sales Discount      $11    

Cash $539

   To  Accounts Receivable  $550

(Being the amount paid is recorded after considering the 2% discount

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b. a single paragraph.

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