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Required information

Exercise $7-5($Algo$)$ Trade and cash discounts; the gross method and the net method compared $[$LO$7-3][$The following information applies to the questions displayed below.$]$

Tracy Company, a manufacturer of air conditioners, sold $150$ units to Thomas Company on November $17,2021.$ The units have a list price of $$560$ each, but Thomas was given a $25\%$ trade discount. The terms of the sale were $\frac{2}{10},\frac{n}{30}.$

Exercise $7-5($Algo$)$ Part $-1$

Required:

Prepare the journal entries to record the sale on November $17($ignore cost of goods$)$and collection on November $26,2021,$ assuming that the gross method of accounting for cash discounts is used.

Prepare the journal entries to record the sale on November $17($ignore cost of goods$)$ and collection on December $15,2021,$ assuming that the gross method of accounting for cash discounts is used.