Juniper Company Uses a Perpetual Inventory System and the Gross

question 209

Multiple Choice

Juniper Company uses a perpetual inventory system and the gross method of accounting for purchases.The company purchased $9,750 of merchandise on August 7 with terms 1/10,n/30.On August 11,it returned $1,500 worth of merchandise.On August 26,it paid the full amount due.The correct journal entry to record the merchandise return on August 11 is:

• A)Debit Accounts Payable $1,500; credit Cash $1,500.
• B)Debit Accounts Payable $1,500; credit Merchandise Inventory $1,500.
• C)Debit Merchandise Inventory $1,500; credit Sales Returns $1,500.
• D)Debit Merchandise Inventory $1,500; credit Cash $1,500.
• E)Debit Accounts Payable $1,500; credit Purchase Returns $1,500.