Monica's Closet received payment in full within the discount period for goods sold on a $600 sales invoice,terms 2/10,n/30.Which entry records this payment?

Question

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When payment is made within the discount period, a seller offers a sales discount to the buyer. In this case, the sales discount is 2% of $600, or $12. The entry to record this payment would be to debit Cash $588 ($600 - $12) and debit Sales Discount $12, and credit Accounts Receivable $600. Option A is incorrect because it improperly credits the Sales account instead of Accounts Receivable. Option B is incorrect because it omits the Sales Discount account. Option C is incorrect because it double debits the Sales Discount account.

Monica's Closet Received Payment in Full Within the Discount Period