The Wheatland Company purchased merchandise on account from a supplier for $18,4
ID: 2547854 • Letter: T
Question
The Wheatland Company purchased merchandise on account from a supplier for $18,400, terms 1/10, n/30. The Wheatland Company returned $2,200 of the merchandise and received full credit.
a. What is the amount of cash required for the payment within the discount period?
$
b. Under a perpetual inventory system, what account is credited by The Wheatland Company to record the return?
- Accounts receivable
-Cost of merchandise sold
- Credit card expense
- Delivery expense
- Merchandise inventory
- Sales
Explanation / Answer
a What is the amount of cash required for the payment within the discount period? (18400-2200)*1% 162 18400-2200-162 16038 Accounts payable 16200 Cash 16038 Merchandise inventory 162 b Under a perpetual inventory system, what account is credited by The Wheatland Company to record the return? Merchandise inventory 2200 Accounts Payable 2200 Merchandise Inventory 2200