A Company Records Purchases Using the Net Method

question 92

Multiple Choice

A company records purchases using the net method. On February 1, they purchased merchandise inventory on account for $8,300 with terms of 1/10, n/30. The February 1 journal entry to record this transaction would include a:

• A) Debit to Merchandise Inventory of $8,300.
• B) Debit to Merchandise Inventory of $8,217.
• C) Debit to Merchandise Inventory of $83.
• D) Credit to Merchandise Inventory of $83.
• E) Credit to Accounts Payable of $8,300.

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Definitions:

Restricting Type

A classification that describes a specific approach or feature within a broader category, often used in the context of dietary disorders where the individual limits intake.

Diabetes Insipidus

A rare condition characterized by intense thirst and the excretion of large amounts of dilute urine, unrelated to diabetes mellitus.

Gastroparesis

Gastroparesis is a medical condition where the stomach takes too long to empty its contents, often due to damage to the vagus nerve.

Type 2 DM

A chronic condition characterized by high blood sugar levels due to insulin resistance and/or a reduction in insulin production.