Scott's Cycles sells merchandise on credit terms of 2/15, n/30. A sale invoiced at $1,500 (cost of sales $975) was made to Shannon Allen on February 1. The company uses the gross method of recording sales discounts.

Required:
1. Give the journal entry to record the credit sale. Assume use of the perpetual inventory system.
2. Give the journal entry, assuming that the account was collected in full on February 9.
3. Give the journal entry, assuming instead that the account was collected in full on March 2. On March 4, the company purchased bicycles and accessories from a supplier on credit, invoiced at $9,000; the terms were 3/10, n/30. The company uses the gross method to record purchases.

Question

contestada

Respuesta :

anthougo anthougo · Answer 1 · 2022-03-22T13:30:59+01:00

1. The journal entry to record the credit sale by Scott's Cycles, using a perpetual inventory system, is as follows:

February 1:

Debit Accounts Receivable $1,500

Credit Sales Revenue $1,500

Debit Cost of goods sold $975

Credit Inventory $975

2. The journal entry to record the collection of the account by Scott's Cycles is as follows:

February 9:

Debit Cash $1,470

Debit Cash Discounts $30

Credit Accounts Receivable $1,500

3. The journal entry to record the collection of the account by Scott's Cycles is as follows:

March 2:

Debit Cash $1,500

Credit Accounts Receivable $1,500

2. The journal entry to record purchase on account by Scott's Cycles is as follows:

March 4:

Debit Inventory $9,000

Credit Accounts Payable $9,000

Journal entries are the accounting records kept by an entity about its daily transactions.

Journal entries identify the accounts involved in each transaction and whether they will be debited or credited.

Learn more about recording journal entries at https://brainly.com/question/17201601