Sign out Chapter 7z x M play Chapter 7 Quiz Help Save& Exit Submit Tracy Company

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Sign out Chapter 7z x M play Chapter 7 Quiz Help Save& Exit Submit Tracy Company, a manufacturer of air conditioners, sold 100 units to Thomas Company on November 17, 2018. The units have a list price of $600 each, but Thomas was given a 30% trade discount. The terms of the sale were 210. ni30. Required: 1. Prepare the journal entries to record the sale on November 17 lignore cost of goods) and collection on 02252 November 26, 2018, assuming that the gross method of accounting for cash discounts is used 2. Prepare the journal entries to record the sale on November 17 (ignore cost of goods) and collection on December 15, 2018, assuming that the gross method of accounting for cash discounts is used. 3-a. Prepare the journal entries to record the sale on November 17 (ignore cost of goods) and collection on November 26, 2018, assuming that the net method of accounting for cash discounts is used 3-b. Prepare the journal entries to record the sale on November 17 (gnore cost of goods) and collection on December 15, 2018, assuming that the net method of accounting for cash discounts is used. Complete this question by entering your answers in the tabs below Req 1 Req 2 Req 3A Req 38 K Prev10 of 10 Next

Explanation / Answer

1

Prepare journal entries to record the sale of november 17 (ignore cost of goods) and collection on november 26 2016

Date

General Journal

Debit

credit

Nov 17 2016

Accounts receivable

42000

     Sales revenue

42000

[100 units * 600 units *(1-0.30)]

Nov 26 2016

cash

41160

Sales discount [42000*2%]

840

    Accounts receivable

42000

(since the amount is paid back in 10 days, 2% discount is offered)

2

Prepare journal entries to record the sale of november 17 (ignore cost of goods) and collection on December 25 2016

Assuming that the gross method forcash discounts is used

Date

General Journal

Debit

credit

Nov 17 2016

Accounts receivable

42000

     Sales revenue

42000

[100 units * 600 units *(1-0.30)]

Dec-15

Cash

42000

    Accounts receivable

42000

3

Prepare journal entries to record the sale of november 17 (ignore cost of goods) and collection on Nov 26 2016

Assume that net method of accounting for cash discounts is used

Date

General Journal

Debit

credit

Nov 17 2016

Accounts receivable

41160

     Sales revenue

41160

[42000*98%]

Nov 26 2016

Cash

41160

    Accounts receivable

41160

4

Prepare journal entries to record the sale of november 17 (ignore cost of goods) and collection on December 25 2016

Assume that net method of accounting for cash discounts is used

Date

General Journal

Debit

credit

Nov 17 2016

Accounts receivable

41160

     Sales revenue

41160

Dec 15 2016

Cash

42000

   Accounts receivable

41160

   Interest revenue

840

1

Prepare journal entries to record the sale of november 17 (ignore cost of goods) and collection on november 26 2016

Date

General Journal

Debit

credit

Nov 17 2016

Accounts receivable

42000

     Sales revenue

42000

[100 units * 600 units *(1-0.30)]

Nov 26 2016

cash

41160

Sales discount [42000*2%]

840

    Accounts receivable

42000

(since the amount is paid back in 10 days, 2% discount is offered)

2

Prepare journal entries to record the sale of november 17 (ignore cost of goods) and collection on December 25 2016

Assuming that the gross method forcash discounts is used

Date

General Journal

Debit

credit

Nov 17 2016

Accounts receivable

42000

     Sales revenue

42000

[100 units * 600 units *(1-0.30)]

Dec-15

Cash

42000

    Accounts receivable

42000

3

Prepare journal entries to record the sale of november 17 (ignore cost of goods) and collection on Nov 26 2016

Assume that net method of accounting for cash discounts is used

Date

General Journal

Debit

credit

Nov 17 2016

Accounts receivable

41160

     Sales revenue

41160

[42000*98%]

Nov 26 2016

Cash

41160

    Accounts receivable

41160

4

Prepare journal entries to record the sale of november 17 (ignore cost of goods) and collection on December 25 2016

Assume that net method of accounting for cash discounts is used

Date

General Journal

Debit

credit

Nov 17 2016

Accounts receivable

41160

     Sales revenue

41160

Dec 15 2016

Cash

42000

   Accounts receivable

41160

   Interest revenue

840

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