Davis Hardware Company Uses a Periodic Inventory System $$\begin{array} { l c } \text { Inventory } & 200 \\\text { Accounts Payable } & 200\end{array}$$

question 135

Multiple Choice

Davis Hardware Company uses a periodic inventory system. How should Davis record the return of inventory previously purchased on account for $200?

• A) \[\begin{array} { l c }
• \text { Inventory } & 200 \\
• \text { Accounts Payable } & 200
• \end{array}\]
• B) \(\begin{array} { l l } \text { Accounts Payable } & 200 \\
• \text{Inventory}&200
• \end{array}\)
• C) Purchase Returns \(\quad 200\)
• Accounts payable\(\quad 200\)
• D) Accounts Payable\(\quad 200\)
• Purchase Returns\(\quad 200\)

---

Definitions:

Market

A place or mechanism where buyers and sellers interact to trade goods, services, or assets, determining prices through supply and demand.

Money Supply

The entirety of cash, coins, and checking and savings account balances that make up the financial assets in an economy at a specific point in time.

Inflation

The rate at which the comprehensive cost levels of goods and services rise, diminishing the effectiveness of financial power.

Unemployment

The condition where people who are able and willing to work cannot secure jobs despite actively looking for one.