If a Purchaser Using a Perpetual Inventory System Pays Freight

question 111

Multiple Choice

If a purchaser using a perpetual inventory system pays freight costs, then the

• A)Inventory account is increased.
• B)Inventory account is not affected.
• C)Freight Out account is increased.
• D)Freight In account is increased.

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Definitions:

Short-Term Borrowing

Refers to loans or debt obligations that are due for repayment within a short period, typically less than one year.

First Delivery

The initial shipment or dispatch of goods from a seller to a buyer.

Instrument

A formal legal document that formally records a legally enforceable act, agreement, or right.

Maker

One who promises to pay a certain sum to the holder of a promissory note or certificate of deposit (CD).