In prior years, john was single and he was a qualifying child of his parents. this year john, age 23 and a full-time student, got married. john and his wife file a joint return. if they were to file separately, john would report a $0 tax liability. john’s wife would report a $200 tax liability. john’s parents cannot claim him as a dependent in the current year.

On june 3, teal company sold to chester company merchandise having a sale price of $2,600 with terms of 2/10, n/60, f.o.b. shipping point. an invoice totaling $91, terms n/30, was received by chester on june 8 from john booth transport service for the freight cost. on june 12, the company received a check for the balance due from chester company. prepare journal entries on the teal company books to record all the events noted above under each of the following bases. (1) sales and receivables are entered at gross selling price. (2) sales and receivables are entered at net of cash discounts.