Question
On June 14, 2021, Rumsfeld Company sold 100 air-conditioning units to Powell Heating and Cooling. The units list for $600 each, but Powell was granted
On June 14, 2021, Rumsfeld Company sold 100 air-conditioning units to Powell Heating and Cooling. The units list for $600 each, but Powell was granted a 25% trade discount. All of Rumsfeld's sales are subject to terms 2/10, n/30. Rumsfeld uses the NET method of accounting for sales discounts.
Required: Show computations.
1. Prepare the journal entry to record the sale.
2. Prepare the journal entry to record receipt of the payment, assuming the correct amount was received on June 22, 2021.
3. Prepare the journal entry to record receipt of the payment, assuming the correct amount was received on July 10, 2021.
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Construction Accounting And Financial Management
Authors: Steven J. Peterson
1st Edition
0131109391, 978-0131109391
