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

question 42

Multiple Choice

Under the periodic inventory system, what is the entry for the credit purchase of 10 electric guitars at $250 per guitar, plus GST of 10%?

• A) Debit purchases $2500; debit GST outlays $250; credit accounts payable $2750
• B) Debit accounts payable $2750; credit purchases $2500; credit GST outlays $250
• C) Debit purchases $2750; credit accounts payable $2750
• D) Debit purchases $2750; credit accounts payable $2500; credit GST outlays $250

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Definitions:

Manufacturing Defect

Refers to a flaw or imperfection in a product that occurs during its production, potentially making it unsafe or unusable.

"Reasonable"

A term used to denote actions or decisions that are logically sound, based on fair judgment and common sense.

Quality Control

The process of ensuring products and services meet customer expectations and regulatory requirements through consistent monitoring and testing.

Due Care

A standard of diligence that a reasonable person exercises to avoid harm to other persons or their property.