Question

Windsor Company sells goods to Danone Inc. by accepting a note receivable on January 2, 2020....

Windsor Company sells goods to Danone Inc. by accepting a note receivable on January 2, 2020. The goods have a sales price of $619,700 (cost of $540,000). The terms are net 30. If Danone pays within 5 days, however, it receives a cash discount of $9,700. Past history indicates that the cash discount will be taken. On January 28, 2020, Danone makes payment to Windsor for the full sales price.

Prepare the journal entry(ies) to record the sale and related cost of goods sold for Windsor Company on January 2, 2020, and the payment on January 28, 2020. Assume that Windsor Company records the January 2, 2020, transaction using the net method. (Credit account titles are automatically indented when the amount is entered. Do not indent manually. If no entry is required, select "No entry" for the account titles and enter 0 for the amounts.)

Date

Account Titles and Explanation

Debit

Credit

choose a transaction date                                                                      Jan. 2, 2020Jan. 28, 2020

enter an account title to record sales

enter a debit amount

enter a credit amount

enter an account title to record sales

enter a debit amount

enter a credit amount

(To record sales)

enter an account title to record cost of goods sold

enter a debit amount

enter a credit amount

enter an account title to record cost of goods sold

enter a debit amount

enter a credit amount

(To record cost of goods sold)

choose a transaction date                                                                      Jan. 2, 2020Jan. 28, 2020

enter an account title to record payment received

enter a debit amount

enter a credit amount

enter an account title to record payment received

enter a debit amount

enter a credit amount

enter an account title to record payment received

enter a debit amount

enter a credit amount

(To record payment received)

show work and explain

Homework Answers

Answer #1
Answer
b) Gross method
Date Account Title Debit Credit
02-Jan Notes receivable $    619,700
             Sales revenue $619,700
02-Jan Cost of goods sold $    540,000
               Inventory $540,000
28-Jan Cash $    619,700
             Notes receivable $619,700
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