During 2014, XYZ Furniture Villa Sold an Inventory Item for $200

Essay

During 2014, XYZ Furniture Villa sold an inventory item for $200 that cost $130. At date of sale, $60 was collected and the balance was to be paid in seven equal instalments. After making two payments, the customer defaulted (in the year following the sale). The item was repossessed in damaged condition; estimates at that date were: Cost to repair, $22; resale costs, $12, and resale value after repair, $80. Give the entry to record the repossession, assuming a perpetual inventory system is used.