5. Never Corp. purchased merchandise during 2014 on credit for P200,000; terms 2/10, n/30. All of the gross liability except P40,000 was paid within the discount period. The remainder was paid within the 3-day term. At the end of the annual accounting period, December 31, 2014, 90% of merchandise had been sold and 10% remained in inventory. The company uses a periodic system. Required: Assuming the net method is used for recording purchases, prepare the entries for the purchase and two subsequent payments.

5. Never Corp. purchased merchandise during 2014 on credit for P200,000; terms 2/10, n/30. All of the gross liability except P40,000 was paid within the discount period. The remainder was paid within the 3-day term. At the end of the annual accounting period, December 31, 2014, 90% of merchandise had been sold and 10% remained in inventory. The company uses a periodic system. Required: Assuming the net method is used for recording purchases, prepare the entries for the purchase and two subsequent payments.

Name: 5. Never Corp. purchased merchandise during 2014 on credit for P200,0
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Description: 5. Never Corp. purchased merchandise during 2014 on credit for P200,000;terms 2/10, n/30. All of the gross liability except P40,000 was paid within thediscount period. The remainder was paid within the 3-day term. At the endof the annual accounting

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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