Under a Perpetual Inventory System, Merchandise Returned by a Customer

question 159

Multiple Choice

Under a perpetual inventory system, merchandise returned by a customer to the seller is recorded as a ________ in the books of the seller.

• A)sales return
• B)sales allowance
• C)sales discount
• D)purchase return

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Definitions:

Open Interest

the total number of outstanding derivative contracts, like futures or options, that have not been settled.

Futures

Legal agreements that compel the purchaser to buy, or the seller to dispose of, an asset at an agreed price and date in the future.

Pounds

The currency unit of the United Kingdom, also known as the British pound sterling, used as a medium of exchange.

Futures Contracts

An agreement to buy or sell a specified quantity of a commodity or financial instrument at a predetermined price at a specified time in the future.