Reference no: EM132734204

Question - Prepare the journal entries for the following independent scenarios. Round all calculations to the nearest dollar.

a) Francona Inc. sold bobblehead dolls with a cost of $267,000 to retailers on account and recorded sales revenue of $445,000 on February 29, 2020. Francona Inc. allows retailers to return bobbleheads that do not sell in 8 months after sale. Past experience shows that the normal return rate is 20%. By September 1, 2020, retailers returned bobbleheads to Francona and were granted credit of $66,000. Prepare Francona's necessary journal entries for February 29, September 1, and September 30, assuming Francona prepares financial statements on September 30 of each year.

b) On June 18, Plesac Corporation sent $55,000 of merchandise on consignment to Clevinger Company; Plesac paid cash for the $3,000 shipping freight costs. Clevinger paid $1,200 for local advertising, which is reimbursable from Plesac. By December 31, 75% of the merchandise had been sold for $80,000. Clevinger notified Plesac, retained a commission of 10%, and remitted the cash due to Plesac on December 31. Prepare Plesac's necessary journal entries for June 18 and December 31.