Question

Question 9 1 pts Two hundred dollars worth of merchandise purchased on account and paid for at an earlier time is now being returned for credit to be applied towards future purchases from this vendor. The credit terms were 2/10, n/30 and the original total invoice of $200, was paid within the discount period. Which of the following is the correct journal entry for the buyer, our customer, to record the return, assuming a perpetual inventory system is used? Receivable, debit, $200; Merchandise Inventory, credit, $200 Accounts Payable, debit, $204; Merchandise Inventory, credit, $204 Accounts Payable, debit, $196; Merchandise Inventory, credit, $196 Accounts Receivable, debit, $200; Merchandise Inventory, credit, $200 Purchases Returns and Allowances, debit, $196; Merchandise Inventory, credit, $196 Question 10 1 pts Office supplies are purchased for cash. The company uses a perpetual inventory system. What is the correct journal entry for this purchase of office supplies? A debit to Purchases and a credit to Cash A debit to Merchandise Inventory and a credit to Accounts Payable A debit to Merchandise Inventory and a credit to Cash O A debit to Office Supplies and credit Cost of Goods Sold O A debit to Office Supplies and a credit to Cash

Answer 1

Q 9)

Answer is (c) Accounts Payable, debit $196; Merchandise Inventory, credit $196

Under perpetual inventory system, if the discount is already availed and then the merchandise is returned, then the amount would be net of discount ($200 - 2% = $196). Since credit for the same can be applied in the future, accounts payable is debited as the same can be adjusted while making future purchases.

Q10)

Answer is (e) A debit to Office Supplies and credit to cash

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