When a Company Uses the Perpetual Inventory System ________

question 71

Multiple Choice

When a company uses the perpetual inventory system ________.

• A) purchases of Office Supplies and Equipment that will be used in the day-to-day operations of the business are recorded as debits to Merchandise Inventory.
• B) the purchase of merchandise inventory on account is recorded as a debit to Accounts Payable and a credit to Merchandise Inventory.
• C) the Merchandise Inventory account is reported as an expense on the income statement.
• D) the Merchandise Inventory account is debited for purchases of goods that the company intends to resell to customers.