Introduction to Accounting

65: Payment for merchandise sold on credit for $100 subject to 1/10 n/30 was received within the discount period — $99 was received.  This was recorded with a debit to Sales Discounts for $1.00, a debit to Cash for $99, and a credit to Accounts Receivable $100, but no mention was made of the subsidiary ledger account.l  This error will cause the:

a. net income for the period to be overstated

b. net income for the period to be understated

c. control account to not agree with the subsidiary ledger

d. assets to be overstated.

 

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