Question

Oriole Company uses the gross method to record sales made on credit. On June 10, 2020, it sold goods worth $247000 with terms 2/10, n/30 to Sandhill Co. On June 19, 2020, Oriole received payment for 1/2 of the amount due from Sandhill Co. Oriole’s fiscal year end is on June 30, 2020. What amount will be reported in the financial statements for the accounts receivable due from Sandhill Co.?

Answer 1

Answer:

$123,500

Explanation:

The computation of the amount reported in the financial statements is shown below

= Sales amount - the amount of sales received

= $247,000 - $247,000 × 50%

= $247,000 - $123,500

= $123,500

by deducting the amount of sale received from the sales amount we can get the amount i.e to be reported in the financial statements