Which of the Following Is the Correct Journal Entry for a Return

question 221

Multiple Choice

Which of the following is the correct journal entry for a return of goods that were purchased on account under the periodic inventory system?

• A) \[\begin{array} { | l | l | l | }
• \hline \begin{array} { l }
• \text { Purchase Returns and } \\
• \text { Allowances }
• \end{array} & \mathrm { XX } & \\
• \hline \text { Accounts Payable } & & \mathrm { XX } \\
• \hline
• \end{array}\]
• B) \(\begin{array}{|l|l|l|}
• \hline \text { Accounts Payable } & \text { XX } \\
• \hline \text { Merchandise Inventory } && \text { XX }\\
• \hline
• \end{array}\)
• C) \[\begin{array} { | l | l | l | }
• \hline \text { Accounts Payable } & \mathrm { XX } & \\
• \hline \begin{array} { l }
• \text { Purchase Returns and } \\
• \text { Allowances }
• \end{array} & & \mathrm { XX } \\
• \hline
• \end{array}\]
• D) \(\begin{array}{|c|c|l|}
• \hline\text { Merchandise Inventory } & \text { XX } \\
• \hline \text { Accounts Payable } && \text { XX } \\
• \hline
• \end{array}\)

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Definitions:

Pareto Optimal Allocation

A condition of resource distribution in which no one person can be made better off without causing detriment to at least another person.

Endowed

In economics, it refers to the initial allocation of income, wealth, or goods to an individual or an entity at the start of an economic analysis or experiment.

Units

Basic quantities or measurements used to express variables, stock, or outputs in any kind of scientific, economic, or engineering calculations.

Edgeworth Box

A diagram used in economics to show the distribution of resources between two individuals, illustrating how trade can lead to an efficient allocation.