Question

Which of the following shows the correct journal entry to record the sale under the gross...

Which of the following shows the correct journal entry to record the sale under the gross method if Beryl Brothers made a $15,000 sale with credit terms of 1/15, n/30?

  • A : Debit Accounts Receivable for $14,850 and credit Sales Revenue for $14,850

  • B : Debit Accounts Receivable for $15,000 and credit Sales Revenue for $15,000

  • C : Debit Accounts Receivable for $14,850 and Sales Discounts for $150 and credit Sales Revenue for $15,000

  • D : Debit Accounts Receivable for $15,000 and Sales Discounts for $150 and credit Sales Revenue for $14,850

0 0
Add a comment Improve this question Transcribed image text
Answer #1

Answer: B : Debit Accounts Receivable for $15,000 and credit Sales Revenue for $15,000

Under the gross method of sales, agreed discount will be allowed only if the customer pays within the due date and as per sales terms otherwise no discount will be allowed. If discount is allowed, accordingly the discount entry will be posted.

Under the net method, the sales and accounts receivable is accounted at net amount.

Add a comment
Know the answer?
Add Answer to:
Which of the following shows the correct journal entry to record the sale under the gross...
Your Answer:

Post as a guest

Your Name:

What's your source?

Earn Coins

Coins can be redeemed for fabulous gifts.

Not the answer you're looking for? Ask your own homework help question. Our experts will answer your question WITHIN MINUTES for Free.
Similar Homework Help Questions
  • 13) May Retailers sold merchandise with a list price of $100,000, subject to a trade discount of 20 percent and cre...

    13) May Retailers sold merchandise with a list price of $100,000, subject to a trade discount of 20 percent and credit terms of 2/10, n/30. At what amount should May record the sale of this merchandise if the gross method is used? a. Debit Accounts Receivable for $100,000. b. Debit Accounts Receivable for $98,000. c. Debit Accounts Receivable for $80,000. d. Debit Accounts Receivable for $78,400. 14) On January 1, 2015, AG Inc. made a $15,000 sale on account with...

  • The entry to record the receipt of payment within the discount period on a sale of...

    The entry to record the receipt of payment within the discount period on a sale of $1500 with terms of 2/9, n/30 will include a A credit to Sales Discounts for $30. B credit to Accounts Receivable for $1500. C credit to Sales Revenue for $1500. D debit to Sales Revenue for $1470.

  • Brief Exercise 7-2 Cullumber Co. uses the gross method to record sales made on credit. On...

    Brief Exercise 7-2 Cullumber Co. uses the gross method to record sales made on credit. On June 1, 2017, it made sales of $67,400 with terms 3/15, n/45. On June 12, 2017, Cullumber received full payment for the June 1 sale. Prepare the required journal entries for Cullumber Co. (If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts. Credit account titles are automatically indented when the amount is entered. Do not...

  • Shor Question 3 View Policies Current Attempt in Progress Bramble Corp. made a $26200 sale on account with the foll...

    Shor Question 3 View Policies Current Attempt in Progress Bramble Corp. made a $26200 sale on account with the following terms: 3/10, 1/30. If the company uses the gross method to record sales made on credit what is are the debitis) in the journal entry to record the sale? Debit Accounts Receivable for $26200 and Sales Discounts for $786 Debit Accounts Receivable for $25414 Debit Accounts Receivable for $26200 Debit Accounts Receivable for $25414 and Sales Discounts for $786 Attempts:...

  • 5. AG Inc. made a $25,000 sale on account with the following terms: 2/10, n/30. If...

    5. AG Inc. made a $25,000 sale on account with the following terms: 2/10, n/30. If the company uses the net method to record sales made on credit, what is/are the debit(s) in the journal entry to record the sale? a. Debit Accounts Receivable for $24,500. b. Debit Accounts Receivable for $24,500 and Sales Discounts for $500. C. Debit Accounts Receivable for $25,000. d. Debit Accounts Receivable for $25,000 and Sales Discounts for $500. 6. On July 22, Peter sold...

  • Exercise 7-6 (Algo) Cash discounts; the gross method (L07-3] Harwell Company manufactures automobile tires. On July...

    Exercise 7-6 (Algo) Cash discounts; the gross method (L07-3] Harwell Company manufactures automobile tires. On July 15, 2021, the company sold 1,900 tires to the Nixon Car Company for $35 each. The terms of the sale were 2/20, n/30. Harwell uses the gross method of accounting for cash discounts Required: 1. Prepare the journal entries to record the sale on July 15 (ignore cost of goods) and collection on July 23, 2021 2. Prepare the journal entries to record the...

  • 6. The following accounts were abstracted from Starr Co's unadjusted trial balance at December 31, 2016:...

    6. The following accounts were abstracted from Starr Co's unadjusted trial balance at December 31, 2016: Credit Debit $750,000 Accounts receivable Allowance for uncollectible accounts Net credit sales Starr estimates that 4.5% of the gross accounts receivable will become uncollectible. 8,000 $3,000,000 at December 31, 2016, the allowance for uncollectible accounts should After adjustment have a credit balance of A) S120,000. B) S112,000. C) $33,750. D) $30,000. 7. Wellington Corp, has outstanding accounts receivable totaling $1.27 million as of December...

  • Fraxon Inc. made a $40,000 sale on account with terms of 1/15, n/30. If the company...

    Fraxon Inc. made a $40,000 sale on account with terms of 1/15, n/30. If the company uses the gross method, which of the following will be included in the journal entry to record customer payment within the discount period? credit Accounts Receivable $40,000 credit Sales Discount $400 credit Sales Revenue $40,000 credit Cash $39,600

  • 20. AG Inc, made a $25,000 sale on account with the following terms: 2/10, 1/30. If...

    20. AG Inc, made a $25,000 sale on account with the following terms: 2/10, 1/30. If the company uses the net method to record sales made on credit, what is/are the debit(s) in the journal entry to record the sale? a. Debit Accounts Receivable for $24,500. b. Debit Accounts Receivable for $24,500 and Sales Discounts for $500. c. Debit Accounts Receivable for $25,000. d. Debit Accounts Receivable for $25.000 and Sales Discounts for $500. 21. Wellington Corp. has outstanding accounts...

  • A customer purchased an item on credit. Which journal entry should be made to record this purchase?

    A customer purchased an item on credit. Which journal entry should be made to record this purchase? Journal EntriesADebitCreditAccounts Receivable$ 250Sales Revenue$ 250BDebitCreditAccounts Receivable$ 250Customer Payment Received $ 250CDebitCreditAccounts Payable$ 237Supplies Expense $ 237DDebitCreditAccumulated Depreciation$ 725Depreciation Expense$ 725EDebitCreditPrepaid Rent$ 1,250Rent Expense$ 1,250

ADVERTISEMENT
Free Homework Help App
Download From Google Play
Scan Your Homework
to Get Instant Free Answers
Need Online Homework Help?
Ask a Question
Get Answers For Free
Most questions answered within 3 hours.
ADVERTISEMENT
ADVERTISEMENT
ADVERTISEMENT