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1, 2013, and made its first purchase of merchandise on May 3. The purchase was for 1,200 units at a price of $10 per unit. On May 5, Allied Parts sold 720 of the units for $14 per unit to Baker Co. Terms of the sale were 2/10, n/60.
a.
On May 7, Baker returns 252 units because they did not fit the customer’s needs. Allied Parts restores the units to its inventory.
b.
On May 8, Baker discovers that 60 units are damaged but are still of some use and, therefore, keeps the units. Allied Parts sends Baker a credit memorandum for $360 to compensate for the damage.
c.
On May 15, Baker discovers that 72 units are the wrong color. Baker keeps 43 of these units because Allied Parts sends a $92 credit memorandum to compensate. Baker returns the remaining 29 units to Allied Parts. Allied Parts restores the 29 returned units to its inventory.
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