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Merchandise Was Sold on Credit for $3,000, Terms 1/10, N/30

Question 4

Multiple Choice

Merchandise was sold on credit for $3,000, terms 1/10, n/30. The entry to record the cash collection should include which of the following?

A) Debit Cash, $3,000, and credit Trade Receivables, $3,000, if collected within the discount period.
B) Debit Cash, $3,000, and credit Trade Receivables, $2,970, and Sales Discount, $30, if collected within the discount period.
C) Debit Cash, $3,000, and credit Trade Receivables, $2,970, and Sales Discount, $30, if collected after the discount period.
D) Debit Cash, $3,000, and credit Trade Receivables, $3,000, if collected after the discount period.

Correct Answer: