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    Gross Method of Discounts: Sunny Inc. Example

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    Sunny Inc. manufactures refrigerators. On April 15, 2010 the company sold 10,000 units to bernies for 500 each. The terms of the sale were 2/10, n30. Using the gross method of discounts prepare the following:

    a. The journal entries to record the April 15 sale and payment made on April 30,2010

    b. The journal entries to record the April 15 sale and payment made on April 20,2010.

    c. Assuming the same situation as in A and B please prepare the two entries assuming the net method was used.

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    Solution Preview

    Solution is provided in a separate excel file attached as follows.

    (a) ...

    Solution Summary

    Provides steps necessary to prepare each journal entry.

    $2.19

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