G On March 12, Medical Waste Services provides services on account to Grace Hospital for $9,700, terms 2/10, n/30. Grace pays for those services on March 20. For Medical Waste Services, record the service on account on March 12 and the collection of cash on March 20

March 12

Dr.  Account receivable  $9,700

Cr.  Sales                          $9,700

March 20

Dr.  Cash                          $9,506

Dr.  Sales Discount          $194

Cr.  Account receivable  $9,700

Explanation:

Term 2/10, n/30 means there is a discount of 2% is available on payment of due amount within discount period of 10 days after sale and net credit period of 30 days.

According to given data

Sales = $9,700

As the payment is made within discount period, so discount will be availed

Discount  = $9,700 x 2% = $194

Payment = $9,700 - $194 = $9,506

Discount of $194 is an expense.

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