If the Net Approach Method Is Applied,the Purchase of $6,500

question 87

Multiple Choice

If the net approach method is applied,the purchase of $6,500 of merchandise with terms 3/20,n/60 is recorded by:

• A)debit Cash $6,500; credit Accounts Payable $6,500.
• B)debit Accounts Payable $6,500; credit Purchases $6,500.
• C)debit Purchases $6,305; credit Accounts Payable $6,305.
• D)debit Purchases $6,305; credit Vouchers Payable $6,305.

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Definitions:

Adjusting Entry

A journal entry made in accounting records at the end of an accounting period to allocate income and expenditure to the appropriate years.

Telephone Bill

A periodic charge for the use of telephone services, often including the cost of calls, subscription fees, and taxes.

Accounts Payable

Money owed by a company to its creditors or suppliers for goods and services received but not yet paid for.

Accumulated Depreciation

The total amount of depreciation expense that has been recorded against an asset over its life up to a specific date.