c $1,225 d. $1,125 sells merchandise on account for $1,800 to Morton Morton Comp

Question

c $1,225 d. $1,125 sells merchandise on account for $1,800 to Morton Morton Company returns $600 of account for $1,800 to Morton Company with credit nerms of merchondise that was damoged, along with a check does Piper Company moke upon receipt 10. Piper Company sells merchandise on 2/10, n/30. to settle the account within the discount period. What entry of the check? a. Cash 1,200 Accounts 1,200 b. Cash 1,176 624 Sales Returns and Allowances Accounts Receivable. 1,800 c Cash 1,176 Sales Returns and Allowances Sales Discounts 600 24 Accounts Receivable 1,800 d. Cash 1764 Sales Discounts 36 600 Sales Returns and Allowances Accounts Receivable 1,200

Explanation / Answer

Net sales marton company is $1,200

Cash receivable after reducing discount $1,176 ($1,200-$24)

Discount expense will be $24 ($1,200×2%)

Hence, correct entry is (C)

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