Grogan Company Purchases Inventory on Account with a Cost of $1,000

question 118

Multiple Choice

Grogan Company purchases inventory on account with a cost of $1,000 and a retail price of $2,000.Grogan Company uses the perpetual inventory method.What journal entry is required on the date of purchase?

• A)debit Purchases for $1,000 and credit Accounts Payable for $1,000
• B)debit Purchases for $2,000 and credit Cash for $2,000
• C)debit Inventory for $1,000 and credit Accounts Payable for $1,000
• D)debit Accounts Receivable for $2,000 and credit Purchases for $2,000