A Company Uses the Periodic Inventory Method

question 148

Multiple Choice

A company uses the periodic inventory method.Which of the following entries would be made to record a return of $200 of inventory purchased on account?

• A) The accounting entry would be a $200 debit to Purchase returns and allowances and a $200 credit to Accounts payable.
• B) The accounting entry would be a $200 debit to Accounts payable and a $200 credit to Purchase returns and allowances.
• C) The accounting entry would be a $200 debit to Purchases and a $200 credit to Accounts payable.
• D) The accounting entry would be a $200 debit to Accounts payable and a $200 credit to Purchases.

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Definitions:

Breach

To violate a legal duty by an act or a failure to act.

Client Confidentiality

The ethical obligation of professionals, especially in legal and medical fields, to keep information given by or about their clients secret from others.

Negligence

The failure to take reasonable care to avoid causing injury or loss to another person, resulting in liability for any damage resulting from this lack of care.

Civil Wrong

A violation of a person's rights or a failure to perform a legal duty owed to a specific individual or society, known as a tort.