On July 8, Ray Inc. sold 100 printers to Office Rental Company at $600 each and offered a 2% discount for payment within 10 days. On July 15, Office Rental Company paid the full amount in cash. What should Ray Inc. record on July 15? A. Cash 60,000 Accounts Receivable 60,000 B. Cash 58,800 Accounts Receivable 58,800 C. Cash 58,800 Sales Discounts 1,200 Accounts Receivable 60,000 D. Cash 60,000 Sales Discounts 1,200 Sales Revenue 58,800 Multiple Choice Option A Option B Option C Option D

Question

Business

Kennedy Spears

25 July, 14:03

On July 8, Ray Inc. sold 100 printers to Office Rental Company at $600 each and offered a 2% discount for payment within 10 days. On July 15, Office Rental Company paid the full amount in cash. What should Ray Inc. record on July 15? A. Cash 60,000 Accounts Receivable 60,000 B. Cash 58,800 Accounts Receivable 58,800 C. Cash 58,800 Sales Discounts 1,200 Accounts Receivable 60,000 D. Cash 60,000 Sales Discounts 1,200 Sales Revenue 58,800 Multiple Choice Option A Option B Option C Option D

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Answers (1)

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Verena · Answer 1

B. Cash 58,800 Accounts Receivable 58,800

Explanation:

Sale of 100 printers to Office Rental Company at $600 each and offered a 2% discount for payment within 10 days

Is Recorded as

Trade Receivable $ 58,000 (debit)

Revenue $58,000 (credit)

Being Recognition of an Asset - Trade Receivable and Recognition of Revenue less sales discount

On payment of full payment transaction is recorded as

Cash $ 58,000 (debit)

Trade Receivable $58,000 (credit)

Being De-recognition of Asset - Trade Receivable and Recognition of Revenue