On December 1, Macy Company sold merchandise with a selling price of $ 5,000 on account to Mrs. Jorgensen, with terms 4 /10, n/30. On December 3, Mrs. Jorgensen returned merchandise with a selling price of $ 900. Mrs. Jorgensen paid the amount due on December 9. What journal entry did Macy Company prepare on December 9 assuming the gross method is used?

Question

Business

Alberto Wiley

26 February, 02:11

On December 1, Macy Company sold merchandise with a selling price of $ 5,000 on account to Mrs. Jorgensen, with terms 4 /10, n/30. On December 3, Mrs. Jorgensen returned merchandise with a selling price of $ 900. Mrs. Jorgensen paid the amount due on December 9. What journal entry did Macy Company prepare on December 9 assuming the gross method is used?

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Armani Newman · Answer 1

The journal entry is shown below:

Cash A/c Dr 3,936

To Accounts receivable A/c 3,936

(Being payment is received within the discount period)

The amount of cash received is shown below:

= Sales - returned goods - discount

= $5,000 - $900 - 4%

= 3,936

Since the cash is received so we debited the cash and credited the account receivable account