The collection of a $900 account after the 2 percent discount period will result in a
A) debit to Cash for $882.
B) debit to Accounts Receivable for $900.
C) debit to Cash for $900.
D) debit to Sales Discounts for $18.

Question

Quizplus · Accepted Answer

The customer did not take advantage of the 2% discount, so the full $900 amount will be collected. Therefore, a debit to Cash for $900 will result. There is no need to debit Accounts Receivable as the account has already been billed and the customer is now paying it off. Sales Discounts is not relevant in this scenario as the customer did not take advantage of the offered discount.

The Collection of a $900 Account After the 2 Percent