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12 October, 08:42

Which of the following journals would a company use to record cash collections from customers, net of discounts taken?

a. General journal. b. Cash receipts journal. c. Cash disbursements journal. d. Purchases journal. e. Sales journal.

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  1. 12 October, 09:02
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    b. Cash receipts journal.

    Explanation:

    When cash will be collected from customers net of discounts cash receipts journal will be used.

    As at time of sale customers account will be debited and at the time when the payments will be received cash receipts journal will be debited and customer's account will be credited and accordingly, since cash is received and specific it is, General Journal will not be affected, and cash disbursements journal will also not be affected.

    Also, as there are no purchases purchase journal will also not be affected, and sales journal will be affected at time of sale but not at he time of receiving payments from customers.

    Thus, correct answer is

    b. Cash receipts journal.
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