1. On July 31, ALOE Inc. received $5,000 cash from a customer who previously purchased ALOE's...

On July 31, ALOE Inc. received $5,000 cash from a customer who previously purchased ALOE's products on account. What entry should ALOE Inc. record at the time it receives cash?

A) Debit Cash, $5,000; credit Service Revenue, $5,000.

B) Debit Accounts Receivable, $5,000; credit Cash, $5,000.

C) Debit Cash, $5,000; credit Accounts Receivable, $5,000.

D) Debit Cash, $5,000; credit Accounts Payable, $5,000.

Solutions

Expert Solution

Option C is the answer

When during the sale the journal entry would be

Debit :- Accounts Receivable

Credit :- sales

When cash is received the entry would be

Debit :- cash

Credit :- Accounts Receivable

ekkarill92 answered 1 year ago

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