Answer:
See explanation section
Explanation:
Requirement 1
<em>November 17, 2021</em> Merchandise Inventory Debit $81,000 (Note - 1)
Accounts payable - Tracy Company Credit $81,000
Calculation - $270 units × $400 = $108,000
$108,000 × (100 - 25)% = $81,000
<em>To record the purchase of office equipment on account with a trade discount and a credit terms of 3/10, n/30. As the company uses perpetual inventory system, merchandise inventory is debit.</em>
<em>November 26, 2021 </em>Accounts payable - Tracy Company Debit $81,000
Cash Credit $78,570
Merchandise Inventory Credit $2,430
As Thomas gave the payment within 10 days, Tracy Company provided a 3% discount according to the terms.
Calculation - $81,000 - ($81,000 × 3)% = $81,000 - 2,430 = $78,570
Requirement 2
If Thomas paid on December 15, 2021, Tracy company would not give any discount. However, Thomas paid within 30 days.
Therefore, the journal entry to record the payment is as follows:
<em>December 15, 2021 </em>Accounts payable - Tracy Company Debit $81,000
Cash Credit $81,000
This time he did not receive the discount as he failed to pay within 10 days to get discount.
