Question

On June 13 of the current year, Kensington Factory sold merchandise to a customer for $8,000 with credit terms 2/10, n/30. The customer paid the full amount due on June 20. Kensington uses the gross method of accounting for cash discounts. Prepare the appropriate journal entry dated June 20.

Answer 1

Answer:

General Journal are given below

Step-by-step explanation:

given data

credit terms = 2/10, n/30

Factory sold = $8,000

solution

as here we get Sales Discount that will be

Sales Discount = 2% of Factory sold price

Sales Discount =  2% × $8000

Sales Discount = $160

so Cash debit will be =  $8,000  - $160 = $7,840

so General Journal will be as

Event                  General Journal                     Debit                credit

1                            Cash                                      $7,840  

                            Sales Discount                       $160

                             Accounts receivables                                 $8,000