question archive A company uses the perpetual method and records merchandise purchases at gross
A company uses the perpetual method and records merchandise purchases at gross
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A company uses the perpetual method and records merchandise purchases at gross. On October 3, the company buys $42,000 of merchandise on account. Terms are 2/10, n/40. On October 9, the company returns goods that cost $10,000. On October 11, the company pays $31,360. What entry does the company record on October 11?
a. debit Accounts Payable $31,360 and credit Cash $31,360
b. debit Accounts Payable $32,000, credit Cash $31,360, and credit Purchase Discounts $640
c. debit Accounts Payable $32,000, credit Cash $31,360, and credit Inventory $630
d. debit Accounts Payable $31,360, credit Purchase Discounts $640, credit Cash $31,360, and credit Inventory $640
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