Answer:
November 17, 2021
Merchandise : air conditioners $45,600 (debit)
Accounts Payable $45,600 (credit)
November 26, 2021
Accounts Payable $45,600 (credit)
Discount Received $1,824 (credit)
Cash $43,776 (credit)
December 15, 2021
Accounts Payable $45,600 (credit)
Cash $45,600 (credit)
Explanation:
November 17, 2021
Merchandise : air conditioners $45,600 (debit)
Accounts Payable $45,600 (credit)
Recognize the Merchandise and Accounts payable at the Purchase Price less trade discount. 190 units × $300 × 80% = $45,600
November 26, 2021
Accounts Payable $45,600 (credit)
Discount Received $1,824 (credit)
Cash $43,776 (credit)
Payment is made within the discount period of 10 days and thus Thomas Company is eligible for a cash discount of 4%. Thomas Company will pay the amount owing less the 4% cash discount. $45,600 × 96% = $43,776.
December 15, 2021
Accounts Payable $45,600 (credit)
Cash $45,600 (credit)
Payment is made out of the discount period of 10 days and thus Thomas Company is not eligible for the cash discount. Thomas Company will pay the full amount owing of $45,600.
