Question

On March 1, Pina Colada Corp. sold merchandise on account to Amelia Company for $30,200, terms 2/10, net 45-On March 6, Amelia returns merchandise with a sales price of 900. On March 11, Pina Colada Corp. receives payment from Amelia for the balance due.
Prepare journal entnes to record the March transactions on Pina Colada Corp.'s books. (You may ignore cost of goods sold entries and explanations.) (Credit account titles are automatically indented when amount is entered. Do not indent manually. Record journal entries in the order presented in the problem.)
Date Account Titles and Explanation Debit Credit
Mar. 11

Answer 1

Answer:

March 1,

DR Accounts Receivable - Amelia $30,200  

     CR  Sales revenue  $30,200  

March 6,

DR Sales return and allowances $900  

     CR Accounts Receivable  $900

 

March 11,

DR Cash $28,714  

DR Sales discounts $586  

    CR Accounts Receivable - Amelia  $29,300

Workings

Sales Discounts - 2/10 net 45 means a disount of 10% if Amelia pays within 45 days. She did.

= 29,300 * 2%

= $586