Explanation:
The journal entries are shown below:
On November 17
Account receivable A/c Dr $99,000
To Sales revenue A/c $99,000
(Being the goods are sold on credit)
The computation is
= 200 units × $660 × (1 - 0.25)
= $99,000
On November 26
Cash A/c Dr $97,020
Sales Discount A/c Dr $1,980
To Accounts receivable $99,000
(Being cash received recorded)
The computation of the discount would be
= Accounts receivable × given percentage
= $99,000 × 2%
= $1,980
The remaining amount would be debited to the cash account.
