Discount

They did not expect White to pay within the 7 days and therefore the invoice would only have taken into account the trade discount of 5%. Therefore the income will have been for 95% x $3,700 = $3,515 and this amount will have been debited to receivables when the invoice was issued. White will have paid 3,515 and therefore when the cash was received the entry will have been as per answer A. Have you watched my free lectures on IAS 15? The lectures are a complete free course for Paper FA and cover everything needed to be able to pass the exam well :-)