When recording a cash receipt from a customer within the discount period, the business records a...

When recording a cash receipt from a customer within the discount period, the business records a debit to Cash for the amount received, a debit to Sales Discounts for the amount of the discount, and a credit to Accounts Receivable for the full amount of the invoice less any returns and allowances.

Record the following sales transactions in general journal form on the books of Collins Company (the seller).

a.	Sold merchandise on account to Gallagher Company, invoice No. 1501, $2,000; terms 1/10, n/30.
b.	Issued credit memo No. 125 to Gallagher Company for damaged merchandise, $250.
c.	Gallagher Company paid the account in full within the discount period.

If an amount box does not require an entry, leave it blank. If required, round your answers to the nearest cent.

GENERAL JOURNAL				PAGE 1
	DESCRIPTION	POST. REF.	DEBIT	CREDIT
a.	Accounts Receivable, Gallagher Company
	Sales
	(Sold merchandise to Gallagher Company , Inv. No. 1501)

b.	Sales Returns and Allowances
	Accounts Receivable, Gallagher Company
	(Issued credit memo No. 125)

c.	Cash
	Sales Discounts
	Accounts Receivable, Gallagher Company
	(Received payment in full.)

Solutions

Expert Solution

The answer has been presented in the supporting sheets. All the parts has been solved with detailed explanation and format. For detailed answers refer to the supporting sheet.

ekkarill92 answered 1 year ago

Next > < Previous

Related Solutions

Explain the rationale for offering a cash discount for payments made within a specified period of...

Explain the rationale for offering a cash discount for payments made within a specified period of time as well as the accounting for such cost reductions.

how to identify detective internal controls risk with cash receipt and cash payment through the business...

how to identify detective internal controls risk with cash receipt and cash payment through the business JB HI-FI

1) Deferred revenue occurs when cash is received from a customer before work or the sale...

1) Deferred revenue occurs when cash is received from a customer before work or the sale is completed. True False 2) In accrual accounting, revenue may be earned prior to or after cash is received. True False 3)An expense incurred in 2016 is not paid until 2017. Using the accrual basis of accounting, the expense should appear on: A.both the 2016 and 2017 income statements B.the 2016 income statement C.neither the 2016 nor 2017 income statement D.the 2017 income statement...

Why not make the following entry when recording bad debt expense for the period? Dr. Bad...

Why not make the following entry when recording bad debt expense for the period? Dr. Bad debt expense, Cr. Accounts receivable

1. David's gasoline station offers a discount if the customer pays in cash. Past evidence indicates...

1. David's gasoline station offers a discount if the customer pays in cash. Past evidence indicates that 70% of all customers pay in cash (probability of a success). If 10 customers are randomly selected, what is the mean number of customers that pay in cash? Select one: a. 1.000 b. 0.7 c. 10 d. 7 2. David's gasoline station offers a discount if the customer pays in cash. Past evidence indicates that 70% of all customers pay in cash (probability...

What is the discounted payback period using the given discount rate and the cumulative cash flow...

What is the discounted payback period using the given discount rate and the cumulative cash flow in the payback period (must get both correct for full credit) of the investment and annual cash flow given below? Discount Rate Investment Annual Income Cash Flow Useful Life 6% 67,000 12,800 12

Compute the amount to be paid for each of the four separate invoices assuming that all invoices are paid within the discount period.

QS 5-4 Computing net invoice amounts LO P1 Compute the amount to be paid for each of the four separate invoices assuming that all invoices are paid within the discount period.

Compute the amount to be paid for each of the four separate invoices assuming that all invoices are paid within the discount period.

Merchandise (gross) Terms Payment a. $8,800 2/10, n/60 b. 25,700 1/15, EOM c. 82,600 1/10, n/30 d. 19,500 3/15, n/45 Compute the amount to be paid for each of the four separate invoices assuming that all invoices are paid within the discount period.

Which of the following correctly describes the effects of recording deferred revenues when cash is received...

Which of the following correctly describes the effects of recording deferred revenues when cash is received from a customer in advance of the services to be provided? A. Revenues are increased B. Liabilities are not affected C. Retained earnings increases D. Net income is not affected

Which of the following methods of project evaluation do not discount future cash flows? payback period...

Which of the following methods of project evaluation do not discount future cash flows? payback period Accounting rate of return internal rate of return both payback and accounting rate of return

Subjects