Question

Jupiter Company sells goods to Danone Inc. by accepting a note receivable on January 2, 2017. The goods nave a sales price or $610,000 (cost of $500,000). The terms are net 30. If Danone pays within 5 days, however, it receives a cash discount of $10,000. Past history indicates that the cash discount will be taken, on January 28, 2017. Danone makes payment to Jupiter for the full sales price. Prepare the Journal entry(ies) to record the sale and related cost of goods sold for Jupiter Company on January 2, 2017, and the payment on January 28, 2017. Assume that Jupiter Company records the January 2, 2017, transaction using the net method. (Credit account titles are automatically Indented when the amount is entered. Do not Indent manually. If no entry is required, select "No entry" for the account titles and enter 0 for the amounts.) Prepare the Journal entry(ies) to record the sale and related cost of goods sold for Jupiter Company on January 2, 7017, and the payment on January 28, 2017. Assume that Jupiter Company records the January 2, 2017, transaction using the gross method. (Credit account titles are automatically indented when the amount is entered. Do not indent manually. If no entry is required, select "No entry" for the account titles and enter 0 for the amounts.)

Answer 1

accounts receivables 610,000 debit

sales revenue 610,000 credit

COGS 500,000 debit

inventory 500,000 credit

cash 610,000 debit

accounts receivables 610,000 credit

Step-by-step explanation:

The gross method will record considering the nominal of the invoince not the net of discount amount.

We record the sale for the nominal which is 610,000

then, as the payment is done after 5 days Jupiter will pay the full amount of 610,000