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E18.17 (LO 3) (Sales with Returns) Refer to the revenue arrangement in E18.16. Assume that instead of selling the tool sets on credit, Steele sold them for cash.
Below is the E18.16
On March 10, 2022, Steele Company sold to Barr Hardware 200 tool sets at a price of $50 each (cost $30 per set) with terms of n/60, f.o.b. shipping point. Steele allows Barr to return any unused tool sets within 60 days of purchase. Steele estimates that: (1) 10 sets will be returned, (2) the cost of recovering the products will be immaterial, and (3) the returned tools sets can be resold at a profit. On March 25, 2022, Barr returned six tool sets and received a credit to its account.
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1. Prepare
2. Indicate the income statement and
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