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Accounting
On June​ 1, Nicholson Company purchased inventory on account with a cost of $1,200. Credit terms were​ 2/10, net 30. On June​ 2, Nicholson Company returned 60 percent of the inventory. Nicholson Company uses the perpetual inventory system. What journal entry did Nicholson Company prepare on June​ 2?

On June​ 1, Nicholson Company purchased inventory on account with a cost of $1,200. Credit terms were​ 2/10, net 30. On June​ 2, Nicholson Company returned 60 percent of the inventory. Nicholson Company uses the perpetual inventory system. What journal entry did Nicholson Company prepare on June​ 2?

FINANCIAL 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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On June​ 1, Nicholson Company purchased inventory on account with a cost of
$1,200.
Credit terms were​ 2/10, net 30. On June​ 2, Nicholson Company returned
60
percent of the inventory. Nicholson Company uses the perpetual inventory system. What journal entry did Nicholson Company prepare on June​ 2?
 
 
 
 
A.
debit Accounts Payable for
$720
and credit Inventory for $720
 
B.
debit Purchase Returns for
$1,200
and credit Accounts Payable for $1,200
 
C.
debit Purchase Returns for
$720
and credit Accounts Payable for $720
 
D.
debit Cash for
$1,200
and credit Accounts Payable for
On June 1, Nicholson Company purchased inventory on account with a cost of $1,200. Credit terms were 2/10, net 30. On June 2, Nicholson Company returned 60 percent of the inventory. Nicholson Company uses the perpetual inventory system. What journal entry did Nicholson Company prepare on June 2? Options: - **A.** Debit Accounts Payable for $720 and credit Inventory for $720 - **B.** Debit Purchase Returns for $1,200 and credit Accounts Payable for $1,200 - **C.** Debit Purchase Returns for $720 and credit Accounts Payable for $720 - **D.** Debit Cash for $1,200 and credit Accounts Payable for $1,200
Transcribed Image Text:On June 1, Nicholson Company purchased inventory on account with a cost of $1,200. Credit terms were 2/10, net 30. On June 2, Nicholson Company returned 60 percent of the inventory. Nicholson Company uses the perpetual inventory system. What journal entry did Nicholson Company prepare on June 2? Options: - **A.** Debit Accounts Payable for $720 and credit Inventory for $720 - **B.** Debit Purchase Returns for $1,200 and credit Accounts Payable for $1,200 - **C.** Debit Purchase Returns for $720 and credit Accounts Payable for $720 - **D.** Debit Cash for $1,200 and credit Accounts Payable for $1,200
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