Cash discount: A cash discount is the reduction in the amount that is to be paid by the credit customers. It is usually allowed by the seller to buyer or customer, in order to motivate the customer to pay within a specified period of time. A cash discount is often referred as sales discount. To prepare: The journal entry to record the sales on July 15 and payment on July 23, 2016.

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Chapter 7, Problem 7.7E

(1)

To determine

Cash discount:

A cash discount is the reduction in the amount that is to be paid by the credit customers. It is usually allowed by the seller to buyer or customer, in order to motivate the customer to pay within a specified period of time. A cash discount is often referred as sales discount.

To prepare: The journal entry to record the sales on July 15 and payment on July 23, 2016.

(2)

To determine

To prepare: The journal entry to record the sales on July 15 and payment on August 15, 2016.

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