Answer:
Required a
<u>April 5,</u>
Merchandise $38,900 (debit)
Accounts Payable ; Culver Company $38,900 (credit)
<u>April 6</u>
Freight Cost $800 (debit)
Cash $800 (credit)
<u>April 7</u>
Equipment $39,900 (debit)
Accounts Payable $39,900 (credit)
<u>April 8</u>
Accounts Payable ; Culver Company $5,000 (debit)
Merchandise $5,000 (credit)
<u>April 15</u>
Accounts Payable ; Culver Company $33,900 (debit)
Discount Received $678 (credit)
Cash $33,222 (credit)
Required b.
Accounts Payable ; Culver Company $33,900 (debit)
Cash $33,900 (credit)
Explanation:
When Tamarisk, Inc. paid the balance due to Culver Company on April 15, the payment is made within the discount period. Thus Tamarisk, Inc <em>is granted a discount of 2%</em> and pays the Account at $33,222 (net of credit granted on merchandise previously returned) .
However, when Tamarisk, Inc. paid the balance due to Culver Company on May 4 instead, the payment is made outside the discount period. Thus Tamarisk, Inc is <em>not granted a discoun</em>t pays the Account in full at $33,900 (net of credit granted on merchandise previously returned) .
