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6 February, 23:52

Merry Maidens Cleaning generally charges $300 for a detailed cleaning of a normal-size home. However, to generate additional business, Merry Maidens is offering a new-customer discount of 10%. On May 1, Ms. E. Pearson has Merry Maidens clean her house and pays cash equal to the discounted price. Record the revenue earned by Merry Maidens Cleaning on May 1.

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  1. 7 February, 00:47
    0
    Record:

    Account name Debit Credit

    Ca 270

    Service revenues 270

    Explanation:

    The revenue earned by Merry Maidens Cleaning on May 1, is the amount paid by Ms. E. Pearson.

    Ms. Pearson paid the discounted price, which is calculated in this way:

    Regular price: $300.00 10% discount: $300.00 * 10% = $300 * 0.10 = $30.00

    Payment: Regular price - discount

    $300.00 - $30.00 = $270.00

    When the company earns a revenue the revenues account increases and must show a credit.

    If cash is received then an asset is increasing, thus the cash account must show a debit.

    Thus the operation must be recorded as:

    Account name Debit Credit

    Car 270

    Service revenues 270
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Home » Business » Merry Maidens Cleaning generally charges $300 for a detailed cleaning of a normal-size home. However, to generate additional business, Merry Maidens is offering a new-customer discount of 10%. On May 1, Ms. E.
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