QUESTIONS Which of the following is CORRECT? Under the perpetual inventory wystem, when a purchaser makes payment within the discount period, the amount of discount will be credited to the Merchandise Inventory account Purchase discounts are calculated on the amount of the merchandise purchased including freight costs. A purchase discount is the amount offered to the purchaser for delaying the payment to the seller Credit terms of a merchandising company are 1/15, net 40. This means that the buyer can receive a discount of 1% f the invoice is paid within 40 days of the invoice dute, QUESTION 9 The Allowance for Bad Debts account has a credit balance of $8,300 before the adjusting entry for bad debts expense. After analyzing the accounts in the accounts receivable subsidiary ledger using of-receivables method, the company's management estimates that uncollectible accounts will be $14,700. What will be the balance of the Allowance for Bad Debts reported on the balance sheet? $23,000 $13,230 $14,700 $6,400 QUESTION 7 On March 18, James Smith purchased $5,000 of furniture from Home Furnishings on account. The cost of the goods was $3.000. On March 20, Home Furnishings granted the customer a $1.000 allowance for goods damaged in transit For Home Furnishings, which of the following represents the correct way to record this transaction? Sales Returns and Allowances 1,000 Cash 1,000 Sales Revenue 1,000 Cash 1.000 Refunds Payable 1.000 Cash 1,000 600 Merchandise Inventory Estimated Returns Inventory 600 1.000 Refunds Payable Accounts Receivable 1,000