A $100,000 sale transaction is made with terms of 5/10, net 30. What entry is made to the accounts receivable account when the sale is made under the net method of recording a discount?

Question

Quizplus · Accepted Answer

Under the net method, sales are recorded at the net amount, assuming the discount will be taken. Therefore, the accounts receivable is debited by $95,000, which is the sale amount minus the 5% discount.

A $100,000 Sale Transaction Is Made with Terms of 5/10