BetterBuy sells $50,000 of TVs to a customer. The credit terms state a 2% discount if paid in 7 days and a 1% discount if paid in 8-14 days. The customer pays in 12 days. How would BetterBuy record the customer's payment?
A) Debit Cash for $50,000 and credit Accounts Receivable for $50,000.
B) Debit Accounts Payable for $50,000, credit Cash for $49,500, and credit Inventory for $500.
C) Debit Cash for $49,500, credit Accounts Receivable for $50,000, and debit Sales Discounts for $500.
D) Debit Cash for $49,500, credit Accounts Receivable for $49,000, and credit Sales Returns & Allowances for
Correct Answer:
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