Which of the Following Statements Is Correct

question 18

Multiple Choice

Which of the following statements is correct?

• A) A purchases accounts only records purchases that have been made on a credit basis
• B) A purchases account only records purchases that have been made on a cash basis
• C) A sales account only records sales that have been made on a cash basis
• D) None of the above statements are correct

---

Definitions:

List Price

The manufacturer's suggested retail price that a product should be sold for.

Discounted

A reduced price or value, often as an incentive for purchase, representing a deduction from the usual cost of goods or services.

Discount Rate

The interest rate used to discount future cash flows to their present value.

Round

To adjust a number to a desired degree of precision, usually to a nearby value that is easier to work with or understand.