ABC Company purchased $10,000 of merchandise on account from XYZ Company; terms
ID: 2540058 • Letter: A
Question
ABC Company purchased $10,000 of merchandise on account from XYZ Company; terms are 3/10, n/30, FOB destination. If ABC uses a perpetual inventory system, the entry required to purchase the inventory at net would include: a debit to Purchases for $10,000; a credit to Purchase Discount for $300; and a credit to Account Payable for $9,700 a debit to Merchandise Inventory for $10,000; a credit to Purchase Discount for $300; and a credit to Account Payable for $9,700 a debit to Purchases for $9,700; a debit to Purchase Discount for $300; and a credit to Account Payable for $10,000 a debit to Purchases for $9,700 and a credit to Account Payable for $9,700 a debit to Merchandise Inventory for $9,700; a debit to Purchase Discount for $300; and a credit to Account Payable for $10,000 a debit to Merchandise Inventory for $9,700 and a credit to Account Payable for $9,700
Explanation / Answer
Journal entry :
so answer is a debit to Merchandise Inventory for $9,700 and a credit to Account Payable for $9,700
Date accounts & explanation debit Credit Merchandise inventory (10000*97%) 9700 Account payable 9700 (To record purchase inventory)