For a Company Using a Perpetual Inventory System, the Journal

question 45

Multiple Choice

For a company using a perpetual inventory system, the journal entry to record the purchase of $1,700 of goods on account, with terms of 3/10, n/30, would include a

• A)debit to accounts payable of $1,700.
• B)credit to accounts payable of $1,649.
• C)debit to merchandise inventory of $1,649.
• D)debit to merchandise inventory of $1,700.

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Definitions:

Quantity Supplied

Quantity supplied refers to the amount of a good or service that producers are willing and able to sell at a given price over a specific period.

Demand Increased

A situation where the quantity of a product or service desired by buyers rises due to factors like income growth, taste changes, or price decreases of the product or complementary goods.

Inferior Good

A type of good for which demand decreases as the income of the consumer increases, opposite of a normal good.

Downsloping

Refers to a curve or line moving downwards on a graph, often used in economics to describe demand curves where price and quantity demanded move in opposite directions.