Required information Exercise 7-5 (Algo) Trade and cash discounts; the gross method and the net method compared [LO7-3] [The following information applies to the questions displayed below.] Tracy Company, a manufacturer of air conditioners, sold 125 units to Thomas Company on November 17, 2024. The units have a list price of $400 each, but Thomas was given a 20% trade discount. The terms of the sale were 3/10, 1/30. Exercise 7-5 (Algo) Parts 1 and 2 Required: 1. Prepare the journal entries to record the sale on November 17 (ignore cost of goods) and collection on November 26, 2024, assuming that the gross method of accounting for cash discounts is used. 2. Prepare the journal entries to record the sale on November 17 (ignore cost of goods) and collection on December 15, 2024, assuming that the gross method of accounting for cash discounts is used. Complete this question by entering your answers in the tabs below. Required 1 Required 2 Prepare the journal entries to record the sale on November 17 (ignore cost of goods) and collection on November 26, 2024, assuming that the gross method of accounting for cash discounts is used. Note: If no entry is required for a transaction/event, select "No journal entry required" in the first account field.

FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
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Required information
Exercise 7-5 (Algo) Trade and cash discounts; the gross method and the net method compared [LO7-3]
[The following information applies to the questions displayed below.]
Tracy Company, a manufacturer of air conditioners, sold 125 units to Thomas Company on November 17, 2024. The units
have a list price of $400 each, but Thomas was given a 20% trade discount. The terms of the sale were 3/10, 1/30
Exercise 7-5 (Algo) Parts 1 and 2
Required:
1. Prepare the journal entries to record the sale on November 17 (ignore cost of goods) and collection on November 26, 2024,
assuming that the gross method of accounting for cash discounts is used.
2. Prepare the journal entries to record the sale on November 17 (ignore cost of goods) and collection on December 15, 2024,
assuming that the gross method of accounting for cash discounts is used.
Complete this question by entering your answers in the tabs below.
Required 1 Required 2
Prepare the journal entries to record the sale on November 17 (ignore cost of goods) and collection on November 26, 2024, assuming
that the gross method of accounting for cash discounts is used.
Note: If no entry is required for a transaction/event, select "No journal entry required" in the first account field.
Transcribed Image Text:! Required information Exercise 7-5 (Algo) Trade and cash discounts; the gross method and the net method compared [LO7-3] [The following information applies to the questions displayed below.] Tracy Company, a manufacturer of air conditioners, sold 125 units to Thomas Company on November 17, 2024. The units have a list price of $400 each, but Thomas was given a 20% trade discount. The terms of the sale were 3/10, 1/30 Exercise 7-5 (Algo) Parts 1 and 2 Required: 1. Prepare the journal entries to record the sale on November 17 (ignore cost of goods) and collection on November 26, 2024, assuming that the gross method of accounting for cash discounts is used. 2. Prepare the journal entries to record the sale on November 17 (ignore cost of goods) and collection on December 15, 2024, assuming that the gross method of accounting for cash discounts is used. Complete this question by entering your answers in the tabs below. Required 1 Required 2 Prepare the journal entries to record the sale on November 17 (ignore cost of goods) and collection on November 26, 2024, assuming that the gross method of accounting for cash discounts is used. Note: If no entry is required for a transaction/event, select "No journal entry required" in the first account field.
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