The Collection of a $1400 Account After the 2 Percent

question 182

Multiple Choice

The collection of a $1400 account after the 2 percent discount period will result in a

• A) debit to Cash for $1372.
• B) debit to Accounts Receivable for $1400.
• C) debit to Cash for $1400.
• D) debit to Sales Discounts for $28.

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Definitions:

IFRS

International Financial Reporting Standards, a set of accounting standards developed by the International Accounting Standards Board (IASB) that aim to make international financial reporting more transparent and comparable across global boundaries.

Cash Receipts

The collection of money, including coins, currency, checks, and electronic funds transfers, by a business from its customers.

Operating Activities

Activities related to the day-to-day functioning of a business that affect the operating income, including sales, supply purchases, and operational expenses.

Common Shares

Ownership in a corporation represented by equity shares, which grant holders the right to vote and a portion of the company's earnings.