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od on a sale of $3,000 with terms of The entry to record the receipt of payment within the discount period on a sale of $3.00
6 Oakland Bookstore had 600 units on band at January 1, costing S10 cach. Purchases and sales during the month of January wer
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Answer #1

1.

Discount amount = Amount due x Discount percentage

= 3,000 x 2/100

= $60

When cash is received, the following will be the journal entry :

Journal

Account Title and Explanation

Debit

Credit
Cash 2,940
Sales discount 60
Accounts receivable 3,000

Correct option is (C)

6.

As per LIFO method, inventory purchased at the latest is charged to cost first. Hence, ending inventory consists of the units purchased at the earliest. Thus, ending inventory cost will be calculated as under :

Date Units Unit cost Total cost
Jan 1 300 10 $3,000

Correct option is (A)
:

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