The Entry to Record a Purchase of $12,000 in Merchandise

question 85

Multiple Choice

The entry to record a purchase of $12,000 in merchandise assuming terms of 2/10,n/30 and a periodic inventory system would include a(n)

• A)increase to Accounts Payable for $12,000.
• B)increase to Purchases Discounts for $240.
• C)decrease to Purchases for $12,000.
• D)decrease to Accounts Payable for $11,760.

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Definitions:

Tax Tables

Charts provided by the IRS that display tax rates and thresholds for different filing statuses and income levels to calculate tax liability.

Sixteenth Amendment

An amendment to the U.S. Constitution that allows Congress to levy an income tax without apportioning it among the states or basing it on the U.S. Census.

U.S. Constitution

The supreme law of the United States that establishes the national government's framework and the fundamental rights of its citizens.

Income Taxes

Taxes imposed by the government on the income generated by individuals, businesses, and other entities.