Which of the Following Journal Entries Would Be Recorded If

question 38

Multiple Choice

Which of the following journal entries would be recorded if a business makes a cash payment to a supplier of $600 "on account" (the business had purchased supplies on account in the previous month) ?

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Definitions:

Physical Counts Of Inventory

The manual counting of all merchandise or stock in a business at a particular time to verify accuracy against recorded inventory levels.

Perpetual System

An inventory accounting system that records purchases and sales of goods instantly through computer systems, without periodically physically counting inventory.

Inventory Adjustment

Modifications made to inventory records to reflect actual inventory levels, often after a physical count.

Inventory Turnover Ratio

A measure of how frequently a company sells and replaces its stock of goods within a certain period, indicating the efficiency of inventory management.