Chancellor Company Purchased Merchandize Worth $900 on Credit,terms N/30 $\begin{array}{lll}\text { Accounts Receivable}&900 \\\text { Purchases }&&900\end{array}$

question 131

Multiple Choice

Chancellor Company purchased merchandize worth $900 on credit,terms n/30.What is the required journal entry to record the transaction under the perpetual inventory system?

• A)
• \(\begin{array}{lll}
• \text { Accounts Receivable}&900 \\
• \text { Purchases }&&900
• \end{array}\)
• B)
• \(\begin{array}{ll}
• \text { Purchases }&900 \\
• \text { Merchandize Inventory }&&900
• \end{array}\)
• C)
• \(\begin{array}{c}
• \text { Merchandize Inventory }&900 \\
• \text { Accounts Payable }&&900
• \end{array}\)
• D)
• \(\begin{array}{ll}
• \text { Accounts Payable } &900\\
• \text { Merchandize Inventory }&&900
• \end{array}\)

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Definitions:

Net Sales Revenue

Net Sales Revenue is the total revenue from sales of goods or services after deducting returned goods and any allowances or discounts.

Bank Reconciliation

A process of ensuring that the bank's records of an individual's or company's cash balance matches the financial records of the company.

Depositor's Book

A record book kept by a depositor, detailing all deposits and withdrawals from a bank account.

Cash Balance

The amount of cash in a company's accounts at any given time, reflecting its immediate monetary resources.