Answered

Welcome to Westonci.ca, where curiosity meets expertise. Ask any question and receive fast, accurate answers from our knowledgeable community. Connect with a community of experts ready to help you find solutions to your questions quickly and accurately. Experience the ease of finding precise answers to your questions from a knowledgeable community of experts.

On February 3, Smart Company sold merchandise in the amount of $5,800 to Truman Company, with credit terms of 2/10, n/30. The cost of the items sold is $4,000. Smart uses the perpetual inventory system and the gross method. Truman pays the invoice on February 8, and takes the appropriate discount. The journal entry that Smart makes on February 8 is: Multiple Choice Cash5,684 Sales discounts116 Accounts receivable 5,800 Cash5,684 Accounts receivable 5,684 Cash4,000 Accounts receivable 4,000 Cash5,800 Accounts receivable 5,800 Cash3,920 Sales discounts80 Accounts receivable 4,000

Sagot :

Parrain

Answer:

Date              Account Details                                     Debit                Credit

Feb 8            Cash                                                        $5,684

                     Sales Discount                                       $     116

                     Accounts Receivable                                                      $5,800

Explanation:

Credit terms of 2/10, n/30 mean that there is a 2% sales discount if the debt if the credit sale is settled in 10 days. If not, the person will have to pay in 30 days.

Truman paid within 10 days so qualifies for the discount which is:

= 5,800 * 2%

= $116

The amount paid will be:

= 5,800 - 116

= $5,684

Thanks for using our platform. We aim to provide accurate and up-to-date answers to all your queries. Come back soon. Thanks for using our platform. We aim to provide accurate and up-to-date answers to all your queries. Come back soon. We're glad you chose Westonci.ca. Revisit us for updated answers from our knowledgeable team.