A Company Using the Net Method of Recording Purchases Failed

question 75

Multiple Choice

A company using the net method of recording purchases failed to take advantage of a discount available. When they pay the full (gross) amount of an invoice at the end of the credit period the journal entry will include a debit to:

• A) Merchandise Inventory.
• B) Sales Discounts.
• C) Discounts Lost.
• D) Cash.
• E) Accounts Receivable.

---

Definitions:

Factory Smokestack

A large chimney through which industrial gases, smoke, and particles are expelled into the atmosphere, often associated with manufacturing plants.

Preventable Health Problems

Health issues that can be avoided through interventions such as vaccinations, healthy lifestyle choices, and public health measures.

Respiratory Disease

Medical conditions that affect the lungs and other parts of the respiratory system, causing difficulty in breathing.