Ganes Computing Sold $70,000 of Inventory on Account to Markel $\begin{array} { l l l } \text { Cash } & \$ 2,000 & \\\quad\text { Accounts Receivable } & &\$ 2,000 \\\end{array}$

question 8

Multiple Choice

Ganes Computing sold $70,000 of inventory on account to Markel Company on April 1,20X3.The company uses a periodic inventory system.Markel Company returned $2,000 of the inventory on April 20,20X3 because it did not fit the company's needs.Which of the following is the journal entry to be made by Ganes Computing for the return of inventory?

• A)\(\begin{array} { l l l }
• \text { Cash } & \$ 2,000 & \\
• \quad\text { Accounts Receivable } & &\$ 2,000 \\
• \end{array}\)
• B)\(\begin{array}{lccc}
• \text { Accounts Receivable } & \$ 2,000 & \\
• \quad\text { Revenue } & &\$ 2,000 & \\
• \end{array}\)
• C)\(\begin{array}{lccc}
• \text { Revenue } & \$ 2,000 \\
• \quad\text { Accounts Receivable } && \$ 2,000 & \\
• \end{array}\)
• D)\(\begin{array}{lccc}
• \text { Revenue } & \$ 2,000 \\
• \quad \text { Sales Returns and Allowances } & &\$ 2,000 & \\
• \end{array}\)
• E)\(\begin{array}{lccc}
• \text { Sales Returns and Allowances } & \$ 2,000\\
• \quad\text { Accounts Receivable } & &\$ 2,000 \\
• \end{array}\)

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