On July 2, 2021, Metlock Company sold to Sue Black merchandise having a sales price of $12,000 (cost $7,200) with terms of 2/10. n/30. f.o.b. shipping point. Metlock estimates that merchandise with a sales value of $750 will be returned An invoice totaling $120, terms n/30, was received by Black on July 6 from Pacific Delivery Service for the freight cost. Upon receipt of the goods, on July 3, Black notified Metlock that $350 of merchandise contained flaws. The same day, Metlock issued a credit memo covering the defective merchandise and asked that it be returned at Metlock's expense. Metlock estimates the returned items to have a fair value of $140. The freight on the returned merchandise was $20 paid by Metlock on July 7. On July 12, the company received a check for the balance due from Black. Your answer is partially correct. Prepare journal entries for Metlock Company to record all the events noted above assuming sales and receivables are entered at gross selling price. (Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter O for the amounts. Record journal entries in the order presented in the problem.)

Conversion cycle is also known as cash cycle or net operating cycle. Conversion cycle refers to how much time a company takes to turn its investments which is done from stock or any other financial resources into cash flows from sales.