Question

Sheffield Co. uses the gross method to record sales made on credit. On July 1, 2020, it made sales of 83,000 with terms 2/10 n/30. On July 9, 2020, Sheffield received full payment for the July 1 sale. Prepare the required journal entries for Sheffield Co. (Credit account titles are automatically indented when the amount is entered. Do not indent manually.)

Answer 1

July 1

Dr r Accounts Receivable $83,000

Cr Sales Revenue $83,000

July 9

Dr Cash $81,340

Dr Sales Discount $1,660

Cr Accounts Receivable $83,000

Step-by-step explanation:

Preparation of the required journal entries for Sheffield Co.

July 1

Dr r Accounts Receivable $83,000

Cr Sales Revenue $83,000

July 9

Dr Cash $81,340

[($83,000 -($83,000 *.02)]

Dr Sales Discount $1,660

($83,000-$81,340)

Cr Accounts Receivable $83,000