Effects of Sales Discounts Citron Mechanical Systems makes all sales on credit, with terms 1/15, n/30. During the year, the list price (prediscount) of services provided was $688,000. Customers paid $482,900 (list price) of these sales within the discount period and the remaining $205,100 (list price) after the discount period. Citron uses the net method of recording sales. Required: 1. Compute the amount of sales that Citron recorded for the year. 2. Compute the amount of cash that Citron collected from these sales. $ 3. Assuming the net method was used for all sales, prepare a summary journal entry to record these sales and a second summary entry to record the cash collected. If an amount box does not require an entry, leave it blank.

Effects of Sales Discounts Citron Mechanical Systems makes all sales on credit, with terms 1/15, n/30. During the year, the list price (prediscount) of services provided was $688,000. Customers paid $482,900 (list price) of these sales within the discount period and the remaining $205,100 (list price) after the discount period. Citron uses the net method of recording sales. Required: 1. Compute the amount of sales that Citron recorded for the year. 2. Compute the amount of cash that Citron collected from these sales. $ 3. Assuming the net method was used for all sales, prepare a summary journal entry to record these sales and a second summary entry to record the cash collected. If an amount box does not require an entry, leave it blank.

Cornerstones of Financial Accounting

4th Edition

ISBN:9781337690881

Author:Jay Rich, Jeff Jones

Publisher:Jay Rich, Jeff Jones

Chapter5: Sales And Receivables

Section: Chapter Questions

Problem 63E

See similar textbooks

Similar questions

Merchandise invoiced at $8,900 is sold on terms 1/10, n/30. If the buyer pays within the discount period, what amount will be reported on the income statement as net sales?
Assume the following information: merchandise is sold on account to customer for P120,000, FOB Shipping Point, 2/10, n/30. The seller paid transportation cost of P6,000. What is the amount of remittance due within the discount period?
On March 1, ZCX company made a sale of $87,500, on credit. If the credit terms were 2/10, n/30, what would be the amount of the sales discount be if the payment is received on March 9?
Schofield Co. sold merchandise on account to Bernard Retail Inc. for $15,000, terms 2/10, n/30. The cost of the merchandise sold was $8,000. Assuming Schofield Co. uses the gross method of recording sales discounts. A. Journalize the entries to record the sale on December 31. B. Journalize the entries to record the receipt of payment assuming it is made within the discount period on December 31.* C. Journalize the entries to record the receipt of payment assuming it is made beyond the discount period on December 31.* *Refer to the Chart of Accounts for exact wording of account titles. CHART OF ACCOUNTSSchofield CompanyGeneral Ledger ASSETS 110 Cash 120 Accounts Receivable-Bernard Retail Inc. 125 Notes Receivable 130 Inventory 131 Estimated Returns Inventory 140 Office Supplies 141 Store Supplies 142 Prepaid Insurance 180 Land 192 Store Equipment 193 Accumulated Depreciation-Store Equipment 194 Office Equipment 195 Accumulated…
Schofield Co. sold merchandise on account to Bernard Retail Inc. for $15,000, terms 2/10, n/30. The cost of the merchandise sold was $8,000. Assuming Schofield Co. uses the gross method of recording sales discounts. A. Journalize the entries to record the sale on December 31. B. Journalize the entries to record the receipt of payment assuming it is made within the discount period on December 31.* C. Journalize the entries to record the receipt of payment assuming it is made beyond the discount period on December 31.* *Refer to the Chart of Accounts for exact wording of account titles.
Scheduled Co. Sold merchandise on account to Bernard Retail Inc. for $15,000, terms 2/10, n/30. The cost of the merchandise sold was $8,000. Assuming Schofield Co. uses the gross method of recording sales discounts. A. Journalize the entries to record the sale on December 31. B. Journalize the entries to record the receipt of payment assuming it is made within the discount period on December 31. C. Journalize the entries to record the receipt of payment assuming it is made beyond the discount period on December 31.
Sales-related transactionsSayers Co. sold merchandise on account to a customer for $80,000 terms2/10, n/30. The cost of the goods sold was $58,000. Journalize Sayers' entries to record (A) the sale, (B) the receipt of payment within thediscount period, and (C) the receipt of payment beyond the discountperiod of ten days.
On December 1, BCX company made a sale of $87,500, on credit. If the credit terms were 2/10, n/30, what would be the amount of the sales discount be if the payment is received on December 7?
Sales-Related Transactions After the amount due on a sale of $172,675, terms 2/10, n/30, is received from a customer within the discount period, the seller consents to the return of the entire shipment. The cost of the merchandise returned was $103,605. If required, round your answers to nearest whole value. a. What is the amount of the refund owed to the customer? b. Illustrate the effects on the accounts and financial statements of the return and the refund. If no account or activity is affected, select "No effect" from the dropdown and leave the correspondir number entry box blank. Enter account decreases, net cash outflows, and all negative effects on net income as negative amounts. Balance Sheet Stockholders' Assets Liabilities Equity Cash v + Inventory v Est. Returns Inventory = Customer Refunds Payable v + No effect v Statement of Cash Flows Income Statement Operating v No effect v
Merchandise costing $2,000 is sold for $3,000 on terms 2/30, n/60. If the customer pays within the discount period, what amount will be reported on the income statement as net sales and as gross profit? Net Sales Gross Profit
On April 1, a company made a sale of $87,500, on credit. If the credit terms were 2/10, n/30, what would be the amount of the sales discount be if the payment is received on April 6?
Required Information [The following information applies to the questions displayed below] Vitamix reports the following information for its year ended December 31: Cash sales Sales on credit General and administrative expenses Sales returns Cost of goods sold Sales discounts Selling expenses $ 92,000 122,000 33,000 14,200 88,000 5,200 56,000 Use the above information, to compute (a) net sales and (b) gross profit. a. Net sales b. Gross profit