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    KrystalLea's Avatar
    KrystalLea Posts: 16, Reputation: 2
    New Member
    		  
    #1

    Nov 20, 2007, 01:49 PM
    Accounting transactions
    What would the transaction be for. .

    Collected a large account receivable in the amount of $40,000.
    Terms on the receivable were N/30 ?



    Purchased merchandise on account from Han Trading for $15,000.
    Terms 2/10 , N/30 ?



    I know 2/10 means 2% in 10 days and N/30 means paid in full in 30 days, right ?
    qcmar24's Avatar
    qcmar24 Posts: 65, Reputation: 3
    Junior Member
    		  
    #2

    Nov 25, 2007, 05:23 PM
    Quote Originally Posted by KrystalLea
    What would the transaction be for . .

    Collected a large account receivable in the amount of $40,000.
    Terms on the receivable were N/30 ?



    Purchased merchandise on account from Han Trading for $15,000.
    Terms 2/10 , N/30 ?



    I know 2/10 means 2% in 10 days and N/30 means paid in full in 30 days, right ?
    For the first entry

    Dr. Cash... 40,000
    Cr. Accounts Receivable... 40,000

    Second entry

    Dr. Merchandise Inventory... 15,000
    Cr. Accounts Payable... 15,000

    If you do the payment 2/10

    Dr. Accounts Payable... 15,000
    Cr. Merchandise Inventory... 300
    Cr. Cash... 14,700

    If paid n/30

    Dr. Acounts Payable... 15,000
    Cr. Cash... 15,000
    KrystalLea's Avatar
    KrystalLea Posts: 16, Reputation: 2
    New Member
    		  
    #3

    Nov 26, 2007, 09:10 AM
    Comment on qcmar24's post
    Gave me the information needed !
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