Answer:
Martinez Company
a) Journal Entries
Jan. 2, 2020:
Debit Accounts Receivable (Danone Inc.) $630,000
Credit Cash Discounts $9,100
Credit Sales Revenue $639,100
To record the sale of goods on account, with trade terms, 5 days $9,100, net 30.
Debit Cost of goods sold $480,000
Credit Inventory $480,000
To record the cost of goods sold.
Jan. 28, 2020:
Debit Cash $639,100
Credit Accounts Receivable (Danone Inc.) $630,000
Credit Cash Discounts $9,100
To record the full receipt of cash on account and the revision of the cash discounts not taken.
Explanation:
a) Data and Analysis:
Jan. 2, 2020:
Accounts Receivable $630,000 Cash Discounts $9,100 Sales Revenue $639,100, terms, 5 days $9,100, net 30.
Cost of goods sold $480,000 Inventory $480,000
Jan. 28, 2020:
Cash $639,100 Accounts Receivable $630,000 Cash Discounts $9,100
