Question
On April 11, Lake Mills Company purchased $89,000 of merchandise on account from a supplier with the terms n/30, FOB destination. On April 22, Lake
On April 11, Lake Mills Company purchased $89,000 of merchandise on account from a supplier with the terms n/30, FOB destination. On April 22, Lake Mills identified $5,500 of the inventory purchased on April 11 was damaged. Lake Mills returned the merchandise to the supplier before they paid the invoice for this purchase.
From Lake Mills's view, the journal entry to record the return will include which of the following:
credit to Accounts Receivable for $5,500 credit to Inventory for $5,500 credit to Accounts Payable for $5,500 debit to Inventory for $5,500
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