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On March 12, Medical Waste Services provides services on account to Grace Hospital for $9,700, terms 2/10, n/30. Grace pays for those services on March 20.

Required:

For Medical Waste Services, record the service on account on March 12 and the collection of cash on March 20.

Respuesta :

Answer:

1. Accounts receivable A/c Dr $9,700

      To Service revenue $9,700

(Being service provided is recorded)

2. Cash A/c Dr                   $9,506

Sales Discount A/c Dr $194    ($9,700 × 2%)

     To  Accounts receivable  A/c  $9,700

(Being cash received recorded and the remaining balance is reported to the cash account in the debit side)

Explanation:

The journal entries are shown below

On March 12

Accounts receivable A/c Dr $9,700

      To Service revenue $9,700

(Being service provided is recorded)

On March 20

Cash A/c Dr                   $9,506

Sales Discount A/c Dr $194   ($9,700 × 2%)

     To  Accounts receivable A/c   $9,700

(Being cash received recorded and the remaining balance is reported to the cash account in the debit side)

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