Question

The journal entry that records the collection of cash from a customer for payment on account for a sale that

was recorded previously includes a debit to:
a. Cash and credit to Accounts Receivable.
b. Accounts Receivable and credit to Cash.
c. Cash and credit to Accounts Payable.
d. Accounts Payable and credit to Cash.

Answer 1

The correct journal entry to record the collection of cash from a customer for a payment on an account previously recorded as a sale is to debit Cash and credit Accounts Receivable.

Step-by-step explanation:

The journal entry that records the collection of cash from a customer for a previously recorded sale on account consists of debiting Cash and crediting Accounts Receivable. When cash is received, it increases the company's assets, hence the Cash account is debited. At the same time, the company's receivable from the customer decreases because the customer has cleared part of their debt, leading to a credit to Accounts Receivable. Therefore, the correct entry is: a. Cash (debit) and Accounts Receivable (credit).