Question
Explain your Answer.
A company that uses the perpetual inventory method purchases inventory of $1,000 on account with terms of 2/10, n/30. Which of the following entnes would be made to record the payment if it is made within 10 days? $980 debit to Accounts payable, a $20 debit to Inventory and a $1,000 credit to Cash $20 debit to Inventory, a $1,000 debit to Accounts payable and a $1,020 credit to Cash $1,000 debit to Accounts payable, a $20 credit to Inventory and a $980 credit to Cash $1,000 debit to Accounts payable and a $1,000 credit to Cash A company that uses the perpetual inventory method purchases inventory of $1,000 on account with terms of 2/10, n/30. Defective inventory of $200 is returned 2 days later and the accounts are appropriately adjusted. If the company paid the vendor within 10 days, which of the following entries would be made to record the payment? $16 debit to Inventory, an $800 debit to Accounts payable and an $816 credit to Cash $784 debit to Accounts payable, a $16 debit to Inventory and an $800 credit to Cash $800 debit to Accounts payable, a $16 credit to Inventory and a $784 credit to Cash $800 debit to Accounts payable and an $800 credit to Cash A company that uses the perpetual inventory method purchased inventory for $2,000 from a vendor on account. FOB shipping point, with terms of 2/10, n/30. The company paid the shipper $100 cash for freight in. The company then returned $200 of damaged goods and got an allowance from the vendor The company paid the vendor 8 days after the sale. Assuming this was the only transaction affecting inventory, and that there was no beginning balance, what would the cost basis of the inventory be? $1,900 $1,864 $2,100 $1,764 A company sold merchandise for $350 that cost $221. The entry to record the cost of the merchandise sold would be a: debit to Cost of goods sold and a credit to Inventory for $221. debit to Cash and a credit to Sales for $350. debit to Sales and a credit to Cash for $350. debit to Inventory for $221 and a credit to Cost of goods sold for $221.
Explanation / Answer
1.a 2.c 3.b 4.b all the above are done thruogh calculations
