Final answer:
The December 15 journal entry for Tracy Company would depend on whether payment was received from Thomas Company. Since it's within the credit term period but before the due date and there's no indication of payment, no journal entry is necessary unless payment is made on that day.
Step-by-step explanation:
The scenario described involves Tracy Company selling 100 units of air conditioners to Thomas Company with a trade discount and certain credit terms. To determine the December 15 journal entry for this transaction, we need to consider the initial sale and the terms given. Since the sale occurred on November 17, 2018, with a list price of $500 each and a 30% trade discount, the amount receivable from Thomas Company would have been recorded as:
- Sales Revenue = 100 units * $500/unit * (1 - 30%) = $35,000
- Accounts Receivable = $35,000 (at the point of sale)
Now, the terms 2/10, n/30 mean that Thomas Company can take a 2% discount if the payment is made within 10 days, otherwise, the net amount is due within 30 days. Since the payment was not made within the discount period (by November 27), the full amount is due by December 17, 2018. On December 15, no entry is required unless payment is received on that day since this falls within the credit term but before the due date. If Thomas Company had made the payment on December 15, the journal entry would show a debit to Cash and a credit to Accounts Receivable for the net invoice amount of $35,000.