Gazoo Co. sold goods with a list price of $45,000 (gross billings) on terms of 2/10, n/30
Question:
Gazoo Co. sold goods with a list price of $45,000 (gross billings) on terms of 2/10, n/30 on December 14, Year 4. Accounts receivable and sales were recorded using the net price method. By December 23, Gazoo had collected on $25,000 (gross billings) of these receivables. On January 2, Year 5, additional collections were made on sales of $5,000 (gross billings). On January 15, Year 5, all remaining balances were collected.
Required:
a. Prepare the journal entry for collections received by December 23, net method of accounting for sales discounts.
b. Prepare the journal entry for any required adjustment, December 31, net method.
c. Prepare the journal entry for collections received on January 15, net method.
Income Tax Fundamentals 2013
ISBN: 9781285586618
31st Edition
Authors: Gerald E. Whittenburg, Martha Altus Buller, Steven L Gill