Answer:
Explanation:
The journal entries are shown below:
On January 4
Merchandise inventory A/c Dr $1,960,000
To Accounts payable A/c $1,960,000
(Being the inventory is purchased on credit)
The computation is shown below:
= 2,500 television sets × $800 × 98%
= $1,960,000
The value is come after considering the discount i.e 100% - 2% = 98%
On January 13
Accounts payable A/c Dr $392,000
To Cash A/c $392,000
(Being the amount is paid)
The computation is shown below:
= 2,500 television sets × $800 × 98% × 20% sets payment
= $392,000
On February 1
Accounts payable A/c Dr $1,568,000
Discount A/c Dr $32,000
To Cash A/c $1,600,000
The computation is shown below:
For Account payable
= 2,500 television sets × $800 × 98% × 80% sets payment
= $1,568,000
For Discount
= 2,500 television sets × $800 × 2% × 80% sets payment
= $1,568,000
