and then we're going to credit.
We want to make sure we credit the full balance
of the accounts receivable for the customer, okay?
So, we know that we're crediting $700. Okay, we know that.
And we're also going to figure out what my discount is,
and that's $700 times 4%.
So, that's $28 in discount.
And so, the cash we're actually going to receive from the customer
is going to be 700 minus 28, which is 672.
So, I want to go to my subsidiary ledger
and I want to reflect that we have a payment.
So, payment for ticket number 51,
uh, with discount, okay?
And this is going to be general ledger... E, I think.
And that is going to be a credit because the customer pay you.
They no longer owe you $1050.
So, they are paying, um...
How much are they paying?
They are paying $700.
Now, if you're in class, you will be, "Hey, Irene, you made a mistake."
The mistake I made is my payment went to the wrong customer.
My payment did not go to Ron;
it went to B. Durant.
So, when you do your problem, you have to be really careful
and make sure that you pay to the right customer, okay?
So, we make a payment and that payment was $700.
It's not $700 cash that you receive,
but because, remember, the customer pay within the discount period.
They pay on a 10, the transaction happened on the 3rd, so that's within ten days.
You are-- you still want to make sure you credit the full amount of accounts receivable.
Otherwise, when you run the report at the end of the month,
how much each customer owes you,
it will still show that the customer owes you that $28.
This is why you would want to debit cash and debit sales discount,
and then credit the full amount $700.
So, we have a credit of $700.
So that's $950-- sorry--
plus the debit side, minus the credit side.
And so, it's $250 that this customer owe you,
which is the beginning balance
from a previous month that we carry over.
All right, so that's E, what's F?
F: we sold $3,000 merchandise inventory to Penny Pry.
Sales price is-- our sales ticket is number 53;
term, again, is the same, 4/10; net, 30.
Cost of merchandise was $2,100.
So, we want to make sure we record a debit to accounts receivable to Penny.
So, that's Penny.
And then, the sale was for $3,000.
We want to make sure we credit sales revenue.
And then, we want to make sure we debit cost of goods sold,
and then also credit merchandise inventory.
The cost of merchandise inventory is given to us,
and that is $2100.
So, again, you would make that journal entry on the same day.
We're going to go to the subsidiary ledger for Penny.
So, we're going to find Penny's account-- subsidiary ledger.
And Penny also have a beginning balance
that's given to us in the data and sometimes it's kind of hidden.
Kind of have to make sure you read really carefully.
So, that's where I find the $800 beginning balance.
So, I'm going to put that beginning balance of $800 for penny.
Um, this transaction happened on the 20th.
It is, um, transaction F.
We are still in, um, page two of the General Journal,
so I'm going to make sure I put in page two of the General Journal.
And this is going to be transaction F.
And this was invoice ticket, um, 50.
What was the invoice ticket? Um, 53, if I remember correctly.
And this was a debit of $3,000.
So, now...
let's extend penny Pry owe our business
So-- and then on the 22nd, what happened on the 22nd?
We receive a cash payment from Ron
for March 4th transaction ticket number 51.
Okay.
So, we want to make sure we go back and look at ticket 51.
Ticket 51 happened on the 4th
and Ron is making a payment on the 22nd,
so more than ten days has passed.
The customer will have to pay the full valu-- full balance.
They don't get to enjoy the sales discount
because it's been more than ten days.
And that sales revenue was $50,
so we want to make sure we record that as cash payment.
So, we got that cash payment; we debit cash.
And then, we credit the accounts receivable for Ron,
which Irene is kind of lazy to type everything,
so the magic of Excel will allow me to...
copy and paste!
And that is $500 that we receive.