Which of the Following Entries Would Be Made to Record

question 90

Multiple Choice

Which of the following entries would be made to record the purchase of inventory on account,if a company uses the perpetual inventory system?

• A) a debit to Purchases and a credit to Accounts Payable
• B) a debit to Accounts Payable and a credit to Purchases
• C) a debit to Merchandise Inventory and a credit to Accounts Payable
• D) a debit to Accounts Payable and a credit to Merchandise Inventory

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Definitions:

Fixed Manufacturing Overhead

Fixed manufacturing overhead consists of indirect production expenses that remain constant regardless of the volume of products manufactured, like equipment depreciation.

Deferred

Refers to actions, expenses, or incomes that are postponed or delayed to a future period instead of being recognized immediately.

Released

Released refers to products, news, or information that has been made available to the public or a specific audience.

Net Operating Income

The earnings derived from a company's day-to-day operations, after subtracting all operational expenses except interest and taxes.