Question
A company sold merchandise for $21,000 on account with terms of 4/15, n/30. The company uses a perpetual inventory system. After two days, it received
A company sold merchandise for $21,000 on account with terms of 4/15, n/30. The company uses a perpetual inventory system. After two days, it received defective merchandise worth $4,000. The journal entry to record the cash receipt for the sale if the payment is received within 10 days of the invoice date would include ________
A. a debit to Cash for $16,320, a debit to Sales Discount for $680, and a credit to Accounts Receivable for $17,000
B. a debit to Sales Revenue for $21,000, a credit to Accounts Receivable for $17,000, and a credit to Sales Discounts for $4,000
C. a debit to Cash for $17,000, a credit to Merchandise Inventory for $680, and a credit to Sales Revenue for $16,320
D. a debit to Cash for $17,000, a debit to Merchandise Inventory for $4,000, and a credit to Accounts Receivable for $21,000
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