Question

Sales-related transactions Sayers Co. sold merchandise on account to a customer for $80,000 terms 2/10, n/30. The cost of the goods sold was $58,000.a. Journalize Sayers’ entries to record the sale,  Journalize the receipt of payment within the discount period, Journalize the entry to record the receipt of payment beyond the discount period of ten days.

Show me step by step how to calculate.

Answer 1

• Entries to be recorded when payment is made within discount period of 10 days, with Perpetual Inventory system and Gross Method:

Accounts title	Debit	Credit
Accounts receivables	$80,000
Sales revenue		$80,000
(to record sales)
Cost of Goods Sold	$58,000
Inventory		$58,000
(to record inventory)
Cash [$80000 - (80000 x2%)]	$78,400
Sales Discount [80000 x 2%]	$1,600
Accounts receivables		$80,000
(to record receipts of payment within discount period)

• Entries to be recorded when payment is NOT made within discount period of 10 days, with Perpetual Inventory system and Gross Method:

Accounts title	Debit	Credit
Accounts receivables	$80,000
Sales revenue		$80,000
(to record sales)
Cost of Goods Sold	$58,000
Inventory		$58,000
(to record inventory)
Cash	$80,000
Accounts receivables		$80,000
(to record receipts of payment )