Ans: Journal entry to record Net method:
date | Account title and explanation | Debit($) | Credit($) |
Jan 2,2020 | Accounts receivables Dr. | 540,000 | |
To sales | 540,000 | ||
( to record sales) | |||
Jan 2,2020 | Cost of goods sold Dr. | $510,000 | |
To Inventory | $510,000 | ||
( to record costs of goods sold) | |||
Jan 28,2020 | Cash Dr. | $550,100 | |
To Accounts receivables | $540,000 | ||
To Sales discount forfeited | $10,100 | ||
( to record payment received) | |||
B). Using gross method:
Date | Account title and explanation | Debit($) | Credit($) |
Jan 2,2020 | Accounts receivables Dr. | $550,100 | |
To sales | $550,100 | ||
( to record sales) | |||
Jan 2, 2020 | Cost of goods sold Dr. | $510,000 | |
To inventory | $510,000 | ||
(to record cost of goods sold) | |||
Jan 28,2020 | Cash Dr | $550,100 | |
To Accounts receivables | $550,100 | ||
( to record payment received) |
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