When Purchases of Merchandise Are Made for Cash, the Transaction

question 179

Multiple Choice

When purchases of merchandise are made for cash, the transaction may be recorded with the following entry

• A) debit Cash; credit Merchandise Inventory
• B) debit Merchandise Inventory; credit Cash
• C) debit Merchandise Inventory; credit Cash Discounts
• D) debit Merchandise Inventory; credit Purchases

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Definitions:

Economies of Scale

Cost advantages reaped by companies when production becomes efficient, as the scale of the operation grows.

Product's Life Cycle

The progression of a product through several stages including introduction, growth, maturity, and decline, affecting marketing strategies and management decisions.

Nostalgia

A sentimental longing or wistful affection for the past, typically for a period or place with happy personal associations.

Antagonism

Opposition or active resistance against something; in pharmacology, it may refer to a substance that interferes with or inhibits the physiological action of another.