A Company Purchased Inventory for $2,000 from a Vendor on Account

question 42

Multiple Choice

A company purchased inventory for $2,000 from a vendor on account, FOB shipping point, with terms of 2/10, n/30. The company paid $100 cash for freight in. The entry to record payment of invoice within 10 days by the purchaser would include: (Assume a perpetual inventory system)

• A)a debit to Accounts Payable for $1,960 and a credit to Cash for $1,960.
• B)a debit to Accounts Payable for $2,000, a debit to Merchandise Inventory for $100 and a credit to Cash for $1,960.
• C)a debit to Accounts Payable for $2,000, a credit to Merchandise Inventory for $40 and a credit to Cash for $1,960.
• D)a debit to Accounts Payable, for$1,960 a debit to Merchandise Inventory for $40 and a credit to Cash for $2,000.

---

Definitions:

Confidence Interval

A confidence interval is a range of values, derived from sample data, that is likely to contain the value of an unknown population parameter.

Point Estimate

A single value given as an estimate of a population parameter that is unknown, typically derived from a sample.

Peripheral Resistance

The resistance to blood flow in the circulatory system, primarily determined by the diameter and elasticity of blood vessels.

Hematocrit

Hematocrit is a measure of the volume percentage of red blood cells in the blood, used in diagnosing and monitoring various medical conditions.