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Problem: Cainas Cookies places an order with Publix for ingredients on 10/29 for $300. Publix ships these on 10/31 and they arrive on 11/2, terms 1/10, n/30, FOB shipping point. Cainas pays for these on 11/5. What entry should Publix make on 11/5 when it receives payment? a. Debit: Cash $300 and Credit: A/R $300 b. Debit: Cash: $300 and Credit: Purchase Discounts $3 and A/P $297 c. Debit: Cash $297 and Sales Discounts $3 and Credit: A/R $300 d. Debit: Cash $300 and Credit: Inventory $300

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Problem Details

Cainas Cookies places an order with Publix for ingredients on 10/29 for $300. Publix ships these on 10/31 and they arrive on 11/2, terms 1/10, n/30, FOB shipping point. Cainas pays for these on 11/5. What entry should Publix make on 11/5 when it receives payment?

a. Debit: Cash $300 and Credit: A/R $300

b. Debit: Cash: $300 and Credit: Purchase Discounts $3 and A/P $297

c. Debit: Cash $297 and Sales Discounts $3 and Credit: A/R $300

d. Debit: Cash $300 and Credit: Inventory $300

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