Question
QUESTION 1 Test Company uses a perpetual inventory system and follows the net method to account for purchase discounts. Test Company reported the following transactions.
QUESTION 1
Test Company uses a perpetual inventory system and follows the net method to account for purchase discounts. Test Company reported the following transactions.
June 2: Purchased $800 of inventory on account with terms 2/10, n/30.
June 2: Paid shipping of $75 for the delivery of the inventory.
The entry to record the purchase of the inventory on June 2 would include
|
| A debit to inventory for $800 | |
|
| A debit to purchases for $784 | |
|
| A debit to inventory for $784 | |
|
| A debit to purchases for $800 |
QUESTION 2.
Test Company uses a perpetual inventory system and follows the gross method to account for purchase discounts. Test Company reported the following transactions.
June 2: Purchased $800 of inventory on account with terms 2/10, n/30.
June 2: Paid shipping of $75 for the delivery of the inventory.
The entry to record the payment for the delivery charges on June 2 would include
|
| A debit to inventory for $75 | |
|
| A debit to freight-in for $75 | |
|
| A debit to delivery expense for $75 | |
|
| A debit to cash for $75 |
question 3
Test Company uses a perpetual inventory system and follows the gross method to account for purchase discounts. Test Company reported the following transactions.
June 2: Purchased $800 of inventory on account with terms 2/10, n/30.
June 2: Paid shipping of $75 for the delivery of the inventory.
Assume Test Company paid for the June 2 inventory purchase in full on June 10. The entry to record the payment would include
|
| A debit to cash for $784 | |
|
| A credit to purchase discounts for $16 | |
|
| A debit to accounts payable for $784 | |
|
| A credit to inventory for $16 |
question 4
Test Company uses a perpetual inventory system and follows the gross method to account for purchase discounts. Test Company reported the following transactions.
June 2: Purchased $800 of inventory on account with terms 2/10, n/30.
June 2: Paid shipping of $75 for the delivery of the inventory.
Assume Test Company paid for the June 2 inventory purchase in full on June 14. The entry to record the payment would include
|
| A debit to accounts payable for $800 | |
|
| A credit to accounts payable for $784 | |
|
| A debit to cash for $800 | |
|
| A credit to interest expense for $16 |
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Security Audit And Control Features Oracle E Business Suite
Authors: Deloitte Touche Tohmatsu Research Team And Isaca
3rd Edition
1604201061, 978-1604201062
