Accounting for Sales on Credit: Net Method

On December 29, 2020, Sabre Company sold merchandise for $2,000 on credit terms, 3/10, n/60. The accounting period ends December 31.

Provide the following entries under the net method.

Note: If a line in a journal entry isn't required for the transaction, select "N/A" as the account name and leave the Dr. and Cr. answers blank (zero).

a. Record the 2020 sale. Omit the cost of good sold entry.

Account Name	Dr.	Cr.
?	?	?
?	?	?

Cash Accounts Receivable Allowance for Doubtful Accounts Interest Receivable Receivable from Factor Note Receivable Discount on Note Receivable Payable to Seller of Receivables Refund Liability Recourse Liability Note Payable Sales Revenue Sales Returns Sales Discount Sales Discount Forfeited Financing Revenue Interest Revenue Cost of Goods Sold Bad Debt Expense Finance Expense Interest Expense Loss on Sale of Note Loss on Sale of Receivables N/A

b. Record collection of the account, assuming collection took place on January 5, 2021.

Account Name	Dr.	Cr.
Cash	?	?
?	?	?
?	?	?

c. Record collection of the account, assuming collection took place on April 1, 2021.

Account Name	Dr.	Cr.
?	?	?
?	?	?
?	?	?

d. Indicate what should be reported on the balance sheet (ignoring cash) and income statement for both 2020 and 2021.

Note: Indicate a contra account balance with a negative sign.

1. First assume parts a and b occur.

Balance Sheet, Dec 31	2020	2021
?	?	?
Income Statement	2020	2021
Saes Revenue, net	?	?

2. Next, assume parts a and c occur.

Balance Sheet, Dec 31	2020	2021
?	?	?
Income Statement	2020	2021
Sales Revenue, net	?	?
Other Revenue	?	?

Note: If a line in a journal entry isn't required for the transaction, select "N/A" as the account name and leave the Dr. and Cr. answers blank (zero) a. Record the 2020 sale. Omit the cost of good sold entry. Account Name Dr. Cr. b. Record collection of the account, assuming collection took place on January 5, 2021. Account Name Dr. Cr. Cash 0 0 c. Record collection of the account, assuming collection took place on April 1, 2021. Account Name d. Indicate what should be reported on the balance sheet (ignoring cash) and income statement for both 2020 and 2021. Note: Indicate a contra account balance with a negative sign. 1. First assume parts a and boccur. Balance Sheet, Dec 31 2020 2021 0 Income Statement 2020 2021 Sales Revenue, net 2. Next, assume parts a and coccur. Balance Sheet, Dec 31 2020 2021 Income Statement 2020 2021 Sales Revenue, nel Other Revenue