A Business Maintains Subsidiary Accounts for Each of Its Customers

question 56

Essay

A business maintains subsidiary accounts for each of its customers. On April 7, the business provides $2,500 in services to Anne Hill on account. The business sells $4,000 (sales price) of merchandise inventory to Ron Wilson on account.
The full amount was collected from each customer on April 26.
Prepare the journal entries for April 7 and April 26. Ignore Cost of Goods Sold and omit explanations.
$$\begin{array} { | l | l | l | l | } \hline \text { Date } &\quad & \text { Debit } & \text { Credit } \\\hline & & & \\\hline & & & \\\hline & & & \\\hline & & & \\\hline & & & \\\hline & & & \\\hline & & & \\\hline & & & \\\hline\end{array}$$

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Definitions:

GDP Deflator

A benchmark for the cost levels of all newly produced, national, final goods and services within an economy.

Real GDP

Gross Domestic Product adjusted for inflation, measuring the value of all final goods and services produced within a country in a year in constant prices.

GDP

Gross Domestic Product, the total market value of all final goods and services produced within a country in a given period, used as a broad measure of its economic performance.

GPI

Genuine Progress Indicator, an alternative metric to GDP that takes into account environmental and social factors when measuring economic progress.