Accounting 9706 · AS & A Level · The accounting system

The accounting system — practice question

As at 1 January, Ann owed Sam $400. She settled the balance on 6 January after deducting a 2% cash discount. How was this recorded by Ann?

  • ADebit: bank $392 and discount allowed $8; Credit: Sam $400
  • BDebit: bank $392 and discount received $8; Credit: Sam $400
  • CDebit: Sam $400; Credit: bank $392 and discount allowed $8
  • DDebit: Sam $400; Credit: bank $392 and discount received $8

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