Manual Company sells goods to Nolan Company during 2012. It offers Nolan the following rebates based on total sales to Nolan.

Manual Company sells goods to Nolan Company during 2012. It offers Nolan the following rebates based on total sales to Nolan. If total sales to Nolan are 10,000 units, it will grant a rebate of 2%. If it sells up to 20,000 units, it will grant a rebate of 4%. If it sells up to 30,000 units, it will grant a rebate of 6%. In the first quarter of the year, Manual sells 11,000 units to Nolan at a sales price of $110,000. Manual, based on past experience, has sold over 40,000 units to Nolan and these sales normally take place in the third quarter of the year. Prepare the journal entry to record the sale of the 11,000 units in the first quarter of the year.

Solutions

Expert Solution

Computation of the Journal Entry to record the sales of the 11,000 unit

Given information

Sales in units 11,000

Sales worth is $110,000

Rebates are = 2% and 4% in total = 6% these value will not record in journal entries

So sold worth of 94%

Journal Entry would be

Accounts Receivable.............................................................. 103,400

Sales Revenue ($110,000 X 94%)............................................. 103,400

Account Title	Debit	Credit
Accounts Receivable	103,400
Sales Revenue		103,400

Renze Joy Candido answered 1 year ago

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