A company purchased P10,000 of merchandise inventory from a vendor who offers credit terms of 2/10 n/30. The company uses the net cost method of recording purchases of merchandise. The company paid the vendor 30 days after receiving the invoice. The journal entry to record the payment would include which of the following? a. A credit to Cash for 10,000. debit to account payable 9,800 b. A debit to Accounts Payable for 10,000, debit merchandise inventory 9800 c. A debit to Purchase Discounts for 200, credit to cash 9,800 d. a debit to account payable 10,000, credit purchase discount 200
A company purchased P10,000 of merchandise inventory from a vendor who offers credit terms of 2/10 n/30. The company uses the net cost method of recording purchases of merchandise. The company paid the vendor 30 days after receiving the invoice. The journal entry to record the payment would include which of the following? a. A credit to Cash for 10,000. debit to account payable 9,800 b. A debit to Accounts Payable for 10,000, debit merchandise inventory 9800 c. A debit to Purchase Discounts for 200, credit to cash 9,800 d. a debit to account payable 10,000, credit purchase discount 200
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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A company purchased P10,000 of merchandise inventory from a vendor who offers credit terms of 2/10 n/30. The company uses the net cost method of recording purchases of merchandise. The company paid the vendor 30 days after receiving the invoice. The journal entry to record the payment would include which of the following?
a. A credit to Cash for 10,000. debit to account payable 9,800
b. A debit to Accounts Payable for 10,000, debit merchandise inventory 9800
c. A debit to Purchase Discounts for 200, credit to cash 9,800
d. a debit to account payable 10,000, credit purchase discount 200
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