4.4-*PLEASE ANSWER ALL 5 QUESTIONS*

5 multiple choice questions.

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Parlington Company entered into the following business events during its first month of operations. The company uses the perpetual inventory system ) The company purchased $12,500 of merchandise on account under terms 2/10,n/30. 2) The company returned $1,200 of merchandise to the supplier before payment was made. 3) The liability was paid within the discount period. 4) All of the merchandise purchased was sold for $18,800 cash. What effect will the return of merchandise to the supplier in event (2) have on Darlington's financial statements? Multiple Choice Assets and stockholders' equity decrease by $1,176. Assets and liabilities decrease by $1,176. Assets and liabilities decrease by $1,200. None. It is an asset exchange transaction. James Company experienced the following events during its first accounting period: (1) Purchased $10,000 of inventory on account under terms 1/10n/30. (2) Returned $2,000 of the inventory purchased in Event 1 (3) Paid the remaining balance in account payable within the discount period for the inventory purchased in Event Immediately after the three events have been recognized, the balance in the inventory account is Multiple Choice $7,920 $8,000 $10,000 Zero James Company experienced the following events during its first accounting period: (1) Purchased $10,000 of inventory on account under terms 1/10n/30. (2) Returned $2,000 of the inventory purchased in Event 1. (3) Paid the remaining balance in account payable for the inventory purchased in Event 1. Based on this information, which of the following shows how paying off the account payable (Event 3) will affect the Company's financial statements? ames Company experienced the following events during its first accounting period. (1) Purchased $10,000 of inventory on account under terms 1/10n/30. (2) Returned $2,000 of the inventory purchased in Event 1. (3) Paid the remaining balance in account payable for the inventory purchased in Event 1. f the Company pays the account payable after the discount period has expired, how much cash will be required to settle the liability? Multiple Choice $7,920 $8,000 $10,000 Zero Multiple Choice $13,500 $900 $500 $0