A Company Uses the Perpetual Inventory System and Recorded the Following

question 92

Multiple Choice

A company uses the perpetual inventory system and recorded the following entry:
$$\begin{array} { | l | r | r | } \hline \text { Accounts Payable } & 2,500 & \\\hline \text { Merchandise Inventory } & & 50 \\\hline \text { Cash } & & 2,450 \\\hline\end{array}$$
This entry reflects a:

• A) Purchase,
• B) Return,
• C) Sale,
• D) Payment of the account payable and recognition of a cash discount taken,
• E) Purchase and recognition of a cash discount taken,

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Definitions:

Fee Simple

The greatest possible interest in land, providing the owner with full ownership rights, including the right to sell or bequeath the property.

Offeror

The party in a contractual agreement who makes an offer to another party, inviting them to enter into a contract, typically specifying the terms of the agreement.

Offeree

The individual or entity to whom an offer is made in a contract situation.

Required Payments

Payments that are mandated by law or contract, which an individual or entity is obligated to make under specific conditions.