When recording a cash receipt from a customer within the discount period, the business records a debit to Cash for the amount received, a debit to Sales Discounts for the amount of the discount, and a credit to Accounts Receivable for the full amount of the invoice less any returns and allowances.

Record the following sales transactions in general journal form on the books of Collins Company (the seller).

a.	Sold merchandise on account to Gallagher Company, invoice No. 1501, $2,000; terms 1/10, n/30.
b.	Issued credit memo No. 125 to Gallagher Company for damaged merchandise, $250.
c.	Gallagher Company paid the account in full within the discount period.

If an amount box does not require an entry, leave it blank. If required, round your answers to the nearest cent.

GENERAL JOURNAL				PAGE 1
	DESCRIPTION	POST. REF.	DEBIT	CREDIT
a.	Accounts Receivable, Gallagher Company
	Sales
	(Sold merchandise to Gallagher Company , Inv. No. 1501)
b.	Sales Returns and Allowances
	Accounts Receivable, Gallagher Company
	(Issued credit memo No. 125)
c.	Cash
	Sales Discounts
	Accounts Receivable, Gallagher Company
	(Received payment in full.)