Question

Required information The following information applies to the questions displayed below Tracy Company, a manufacturer of air conditioners, sold 150 units to Thomas Company on November 17 2021. The units have a list price of $560 each, but Thomas was given a 25% trade discount. The terms of the sale were 2/10, n/30 Required: 1. Prepare the journal entries to record the sale on November 17 ignore cost of goods) and collection on November 26, 2021 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, 2021, assuming that the gross method of accounting for cash discounts is used Complete this question by entering your answers in the tabs below. Reg 1 Reg 2 Prepare the journal entries to record the sale on November 17 (ignore cost of goods) and collection on November 26, 2021, assuming that the gross method of accounting for cash discounts is used. If no antry required for a transaction/Vent, select "No journal entry required in the first account feld.) View transaction let Journal entry worksheet Record the sale of 150 units with a list price of $500, a 25% trade discount (if applicable), with terms of 2/10, /30 under the gross method. Note Enter debit before credito General Journal Debit Credit November 17, 2021 LLLLLLLL Record entry I Clear entry Vw general journal

Answer 1

1.

Date	General Journal	Debit	Credit
November 17, 2021	Accounts receivable - Thomas company	$63,000
	Sales		$63,000

Date	General Journal	Debit	Credit
November 26, 2021	Cash	$61,740
	Sales discount	$1,260
	Accounts receivable - Thomas company		$63,000

List price = $560

Trade discount = 25%

= 560 x 25%

=$140

Selling price per unit = List price - Trade discount

= 560-140

= $420

Sales revenue = Number of units sold x Selling price per unit

= 150 x 420

= $63,000

sales discount = Sales x 2%

= 63,000 x 2%

= $1,260

Cash received = Sales - sales discount

= 63,000-1,260

= $61,740

2.

Date	General Journal	Debit	Credit
November 17, 2021	Accounts receivable - Thomas company	$63,000
	Sales		$63,000

Date	General Journal	Debit	Credit
December 15, 2021	Cash	$63,000
	Accounts receivable - Thomas company		$63,000

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