On January 6, Blossom Co. sells merchandise on account to Pryor Inc. for $10,300, terms 4/10, n/30. On January 16, Pryor Inc. pays the amount due. Prepare the entries on Blossom's books to record the sale and related collection. (Omit cost of goods sold entries.)

Question

Amber Wall

Business

9 May, 12:07

On January 6, Blossom Co. sells merchandise on account to Pryor Inc. for $10,300, terms 4/10, n/30. On January 16, Pryor Inc. pays the amount due. Prepare the entries on Blossom's books to record the sale and related collection. (Omit cost of goods sold entries.)

+5

Answers (1)

Know the Answer?

Zion Ritter · Answer 1

Blossom Co.

Journal Entry

Date Particulars Debit Credit

6 Jan Accounts Receivable $10300

Sale $ 10300

Blossom Co. sells merchandise on account to Pryor Inc. for $10,300, terms 4/10, n/30.

16 Jan Cash $9888

Discount Allowed 412

Accounts Receivable $ 10300

The terms 4/10, n/30 means that 4% discount is allowed with in the first ten days of sale. As payment is made on 16 Jan which is the tenth day of Sale the discount is calculated as 4% of 10300 = $ 412.

The cash received would be $ 10300 - $ 412 = $ 9888