Question - National Electric Company sells a wide variety of consumer good products to various retailers. On March 15, 2017, National delivers to its customer, Bullseye Products, 400,000 coffeemaker machines. The selling price is $100 per machine. National's cost for manufacturing each machine if $60. The terms of the contract between National and Bullseye allows Bullseye to return coffemakers to National for a full refund if Bullseye is unable to sell the machines to customers. The returned goods will go back to National's inventory for a later sale to another customer. Bullseye may return goods for a refund until June 30. Past experience indicates that customers such as Bullseye typically return 10% of the products purchased.
On April 10, 2017, Bullseye returns 20,000 of the coffemakers and makes a payment to National for 380,000 coffemakers. On this date the transaction is considered complete.
Please prepare the appropriate accounting entries to fully account for the transaction on:
1. March 15, 2017
2. April 10, 2017