Gross and net methods for sales discounts Obj. 4 The following were selected from among the transactions completed by Strong Retail Group during August of the current year:

Aug. 5. Sold merchandise on account to M. Quinn, $7,500, terms 2/10, n/30. The cost of the merchandise sold was $4,200.

9. Sold merchandise on account to R. Busch., $4,000, terms 1/10, n/30. The cost of the merchandise sold was $2,100.

15. Received payment on account for the sale of August 5 less the discount.

20. Sold merchandise on account to S. Mooney, $6,000, terms n/eom. The cost of the merchandise sold was $3,300.

25. Received payment on account for the sale of August 9.

31. Received payment on account for the sale of August 20.

a. Journalize the August transactions using the gross method of recording sales discounts.

b. Journalize the August transactions using the net method of recording sales discounts.

c. What is the total sales for August under each method?

d. Which method of recording sales discounts requires an end-of-period adjusting entry?

AppendixLO1