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On September 12, Jepson Company purchased merchandise in the amount of $5,800 from Vander Company, Inc. on credit with terms of 2/10, n/30. Jepson uses
On September 12, Jepson Company purchased merchandise in the amount of $5,800 from Vander Company, Inc. on credit with terms of 2/10, n/30. Jepson uses the gross method of accounting for purchases and a periodic inventory system. On September 14, Jepson returns some of the merchandise with a purchase price of $500. Jepson pays the invoice on September 18 and takes the appropriate discount. The journal entry that Jepson makes on September 18 is: Cash 5,194 Accounts payable 5,194 Accounts payable 5,300 Purchase discounts 106 5,194 Cash Accounts payable 5,684 Cash 5,684 Cash 5,800 Accounts payable 5,800 Accounts payable 5,194 Purchase discounts 106 Cash 5,300
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