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Harwell Company manufactures automobile tires. On July 15, 2011, the company sold 1,000 tires to the Nixon Car Company for $50 each. The terms of the sale were 2/10, n/30. Harwell uses the net method of accounting for cash discounts.
Required:
1. Prepare the journal entries to record the sale on July 15 (ignore cost of goods) and payment on July 23, 2011.
2. Prepare the journal entries to record the sale on July 15 (ignore cost of goods) and payment on August 15, 2011.
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