Pistons Company, a VAT-registered company, sold an item on credit for P5 000,000, exclusive of VAT, less
Pistons Company, a VAT-registered company, sold an item on credit for P5 000,000, exclusive of VAT, less multiple trade discounts of 20% and 5%.
Question:
8. The correct entry to record this sale is
a.
Trade Discount 1,200,000
Sales 5,000,000
Output Tax Payable 600,000
Allowance for Sales Discounts 1,200,000
b. Accounts Receivable 5,600,000
Sales 5,000,000
Output Tax Payable 600,000
c. Accounts Receivable 3,800,000
Sales 3,800,000
d. Accounts Receivable 4,256,000
Sales 3,800,000
Output Tax Payable 456,000
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