Under the Periodic Inventory System, What Is the Entry for the Cash

question 64

Multiple Choice

Under the periodic inventory system, what is the entry for the cash purchase of 5 electric guitars at $500 each, plus 10% GST?

• A) DR Purchases $2500; DR GST receivable $250; CR Bank $2750
• B) DR Accounts payable $2750; CR Purchases $2500; CR GST payable $250
• C) DR Purchases $2750; CR Bank $2750
• D) DR Purchases $2750; CR Bank $2500; CR GST payable $250

---

Definitions:

Utility Function

A mathematical representation that captures the preference ranking of various bundles of goods by an individual, translating these preferences into a level of utility or satisfaction.

Income

Refers to the money received, typically on a regular basis, for work or through investments.

Price

The amount of money required to purchase a good or service.

Price

The amount of money required to purchase a good or service, often determined by factors like demand, supply, and market competition.