Under the Periodic Inventory System, the Journal Entry to Record

question 210

Multiple Choice

Under the periodic inventory system, the journal entry to record the purchase of merchandise inventory will include a debit to

• A) Merchandise Inventory
• B) Purchases
• C) Accounts Payable
• D) Cost of Merchandise Purchased

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Definitions:

Direct Labor-Hour

A measurement of labor used in production, specifically the time spent by direct labor workers on a given job or project.

Manufacturing Overhead Budget

An estimation of all manufacturing overhead costs planned for a specific period, which includes indirect costs related to manufacturing.

Selling and Administrative Expense Budget

A financial plan that estimates future sales, administrative expenses, and related activities over a specific period.

Budget Data

Financial projections that outline expected income and expenses for a company over a specific period.