A company using the perpetual inventory system purchased inventory worth $24,000 on account with terms of 3/10, n/30. Defective inventory of $2,000 was returned two days later, and the accounts were appropriately adjusted. If the invoice is paid 10 days after the invoice date, the amount of the purchase discount that would be available to the company is ________. A. $780 B. $720 C. $660 D. $710

A company using the perpetual inventory system purchased inventory worth $24,000 on account with terms of 3/10, n/30. Defective inventory of $2,000 was returned two days later, and the accounts were appropriately adjusted. If the invoice is paid 10 days after the invoice date, the amount of the purchase discount that would be available to the company is ________. A. $780 B. $720 C. $660 D. $710

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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[This is a variation of E 8–9 modified to focus on the net method of accounting for purchase discounts.]On July 15, 2018, the Nixon Car Company purchased 1,000 tires from the Harwell Company for $50 each. Theterms of the sale were 2/10, n/30. Nixon uses a periodic inventory system and the net method of accounting forpurchase discounts.Required:1. Prepare the journal entries to record the purchase on July 15 and payment on July 23, 2018.2. Prepare the journal entry to record the payment on August 15, 2018.3. If Nixon instead uses a perpetual inventory system, explain any changes to the journal entries created inrequirements 1 and 2.
a. Determine the adjustment to the allowance for overvaluation account. b. Compute the consolidated inventory at the end of the year.
Qq.12. Subject :- Account
12. Boston Dollar Store uses the gross method to record purchase discounts and uses a perpetual inventory system. Boston engaged in the following transactions during April:April 12 - Purchased $15,000 in merchandise subject to terms of 2/10, n/30. The goods were shipped f.o.b. shipping point.April 13 - Received a billing from Orange Freight Lines for $300 for the April 12 purchase.April 15 - Returned $1,000 of merchandise from the April 12 purchase.April 20 - Paid balances due from April 12 purchase.Required:Prepare journal entries to record the above transactions. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.)
A company using the perpetual inventory system purchased inventory worth $25,000 on account with terms of 2/10, n/30. Defective inventory of $2,000 was returned 2 days later and the accounts were appropriately adjusted. If the invoice is paid within 10 days, the amount of the purchase discount that would be available to the company is OA. $500 OB. $460 OC. $540 OD. $490
The following units of an inventory item were available for sale during the year: Beginning inventory 8 units at $50 First purchase 18 units at $51 Second purchase 27 units at $56 Third purchase 16 units at $61 The firm uses the periodic inventory system. During the year, 50 units of the item were sold. The value of ending inventory using LIFO is a. $961 b. $1,161 c. $1,361 d. $400
The following units of an inventory item were availate for sale during the year. Uhe this indormation to answer the following question. egnng ventary Ftchae Second purchane Thed purchase 10 unts at 55 25 unts at se 20 units at s 15 ts at The firm uses the perlodic invertory system. During the year, 60 units of the item were sold. The value of ending inventury using LIFO is 1.350 S1.150 1.250
If Able Ltd, registered for GST, purchased inventory from a supplier for $9 000 (excluding GST), returned $1 500 worth of inventory (excluding GST) two days later and then paid the account within the discount period to take advantage of a 2% discount, what amount would Able Ltd record for discount received? please recalculate