Under a Periodic Inventory System, Purchase of Merchandise Is Debited

question 29

Multiple Choice

Under a periodic inventory system, purchase of merchandise is debited to the

• A)Inventory account.
• B)Cost of Goods Sold account.
• C)Purchases account.
• D)Accounts Payable account.

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Definitions:

Cost Principle

An accounting principle that requires assets, liabilities, equity, and expenses to be recorded at their original cost.

Market Value

The market's current rate for transactions involving the purchase or sale of an asset or service.

Appraisal

The process of professionally estimating the value of a property, often used for taxation or sale purposes.

Purchase Price

The amount of money paid to buy a product or service, including any additional charges.