Emily Purchased $2,000 of Merchandise on April 1 and Recorded

question 67

Multiple Choice

Emily purchased $2,000 of merchandise on April 1 and recorded it in the voucher register. On April 8, $400 of the merchandise proved to be defective. The company uses the gross method and the periodic inventory system. The entry would be to:

• A) reduce the original voucher.
• B) record a purchase return in the general journal.
• C) cancel the original voucher and record a revised voucher.
• D) None of these answers is correct.

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Definitions:

Breach

The violation or failure to fulfill a duty, obligation, or promise, especially in terms of contract terms.

Warranty

A guarantee provided by the seller or manufacturer concerning the condition of its product, promising to repair or replace it if necessary within a certain period.

Incidental Damages

Compensation for unforeseen damages that occur as a secondary effect of a breach of contract.

Resell

The act of selling an item or asset previously bought, typically for profit.