Feb. 10: Sold merchandise inventory on account for $4,900. Payment terms were 3/

Question

Feb. 10: Sold merchandise inventory on account for $4,900. Payment terms were 3/15, n/30. These goods cost the company $2,450 Begin by preparing the entry to journalize the sale portion of the transaction. Do not record the expense related to the sale. We will do that in the following step Debit Credit Date Accounts Feb. 10 Now journalize the expense related to the February 10 sale-Cost of goods, $2,450 Debit Credit Date Accounts Feb. 10 Feb. 12: Paid amount owed on credit purchase of February 3, less the return and the discount. Debit Credit Date Accounts Feb. 12

Explanation / Answer

Journal entry :

Date accounts & explanation debit credit Feb 10 Account receivable 4900 Sales revenue 4900 (To record sales) Feb 10 Cost of goods sold 2450 Merchandise inventory 2450 (To record cost of goods sold) Feb 12 Cash (4900*97%) 4753 Sales discount 147 Account receivable 4900 (To record amount received)

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