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26 February, 16:51

On April 2, Kelvin sold $40,000 of inventory items on credit with the terms 1/10, net n/30. Payment on $24,000 sales was received on April 8 and the remaining payment on $16,000 sales was received on April 27. Assuming Kelvin uses the gross method of accounting for sales discounts, the entry recorded on April 8 would be: a. Debit to Cash for $23,760 and Sales Discounts for $240 and credit to Accounts Receivable for $24,000. b. Debit to Cash for $23,760 and credit to Accounts Receivable for $23,760. c. Debit to Cash for $24,000 and credit to Accounts Receivable for $24,000. d. Debit to Cash for $24,000 and credit to Sales Discounts Forfeited for $240 and Accounts Receivable for $23,760.

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  1. 26 February, 17:19
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    d. debit to Cash for $24,000, credit to Accounts Receivable for $23,760 and credit to Sales Discounts Forfeited for $240.

    Debit Credit

    Cash $ 24,000.00

    Accounts Receivable $ 23,760.00

    Sales Discount Forfeited (24000*1%) $ 240.00
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