On December 1, Macy Company sold merchandise with a selling price of $9,000 on account to...

On December 1, Macy Company sold merchandise with a selling price of $9,000 on account to Mrs. Jorgensen, with terms 4/10, n/30. On December 3, Mrs. Jorgensen returned merchandise with a selling price of $700. Mrs. Jorgensen paid the amount due on December 9. What journal entry did Macy Company prepare on December 9 assuming the gross method is used?

A) Debit Cash for $7,968 and credit Accounts Receivable for $7,968.

B) Debit Sales Revenue for $7,968, debit Sales Discounts for $332, and credit Accounts Receivable for $8,300.

C) Debit Sales Revenue for $8,300, credit Sales Discount for $332 and credit Cash for $7,968.

D) Debit Cash for $7,968, debit Sales Discounts for $332, and credit Accounts Receivable for $8,300.

Expert Solution

Solution:

Journal Entry
Date	Particulars	Debit	Credit
09-Dec	Cash Dr ($8300*96%)	$7,968
	Sales Discount Dr ($8300*4%)	$332
	To Accounts Receivable ($9000- $700)		$8,300

Hence option "D" is correct.

ekkarill92 answered 2 years ago

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