Why is using the Purchases Returns and Allowances account preferred to crediting these transactions to Purchases?

Question:

Fantastic news! We've Found the answer you've been seeking!

Step by Step Answer:

Related Book For book-img-for-question

College Accounting A Contemporary Approach

ISBN: 978-0077639730

3rd edition

Authors: David Haddock, John Price, Michael Farina

See More Books

Question Posted: May 25, 2016 04:28 AM

See More Questions

Alana Szeqczyks accounting system that uses sales, purchases, cash receipts and cash payments journals and a general journal. At various times during the year, the following errors have occurred. 1....
Indicate which of the following accounts would be included in the chart of accounts of a merchandising company using either the (a) Periodic inventory system or (b) Perpetual inventory system. If the...
Journalizing purchases returns and allowances and posting to general ledger and accounts payable ledger Using page 3 of a general journal and the following general ledger and accounts payable ledger...
What is the benefit to a company from a securities underwriter? They study the market and advise companies on where to set their IPO share price. They help companies to reduce the risk associated...
Refer to Exercise 5-1 and prepare journal entries to record each of the merchandising transactions assuming that the periodic inventory system is used.
Estimate the capital required under Basel I for a bank that has the following transactions with a corporation (assume no netting): (a) a 9-year interest rate swap with a notional principal of $250...
Suppose x has an exponential distribution with u = 1. Find the following probabilities: a. P1x 7 12 b. P1x 32 LO8 c. P1x 7 1.52 d. P1x 52
The Coca-Cola Company and PepsiCo, Inc. Instructions Go to the books companion website and use information found there to answer the following questions related to The Coca-Cola Company and PepsiCo,...
49 Required information [The following information applies to the questions displayed below.] Part 1 of 7 Finlon Upholstery, Inc. uses a job-order costing system to accumulate manufacturing costs....
The balance sheet and income statement for Chico Electronics are reproduced below (tax rate is 40%). Required: Compute and interpret the following financial ratios of the company for Year 5: a....
On what financial statement do the accounts related to purchases of merchandise appear? In which section of this statement are they reported?
What account is debited for the purchase of merchandise inventory when (a) The periodic inventory system is used (b) The perpetual inventory system is used?
A graphical approach was used to solve the following LP model in Problem 2-15: Maximize profit = $4X + $3T Subject to the constraints 3XY 27 X, Y >0
The pipe assembly is mounted vertically as shown in (Figure 1). Part A Figure 200 mm 80 mm- 1.2 m Determine the pressure at A if the velocity of the water ejected from B is 0.77 m/s. Express your...
Suppose you were asked to estimate the probability that your coin came up "Heads" from your observations. Provide such an estimate including a 90% confidence interval. Explain your calculations.
Given the following C++ code snippet, what is the value of num3? Your answer must be exact. int num1, num2, num3; int *p_num1 - &num1; int *p_num2 &num2; *p_num1 15; *p_num2 10; * num3 = *p_num1...
# 1. On April 1, C.S. Lewis Company borrows (Notes payable) $70,000 from Lyon National Bank by signing a 3 month 8% note. Prepare the journal entries to record: a) the issuance of the note b) the...
Find and correct the program below, check your answer by running the script 1. 2. #include int main() 3. { 4. float Number1; 5. double Number2; 6. 7. 8. printf("Enter a number: "); scanf("%f",&num1)...
Students in a developmental psychology lab course conducted an observational study of parentinfant interactions in the home. When they first entered the home on each of the 4 days they observed a...
On the basis of the details of the following fixed asset account, indicate the items to be reported on the statement of cashflows: ACCOUNT Land ACCOUNT NO. Balance Date Item Debit Credit Debit Credit...
The worksheet of Lantzs Office Supplies contains the following revenue, cost, and expense accounts. Prepare a classified income statement for this firm for the year ended December 31, 20X1. The...
Hog Wild is a retail firm that sells motorcycles, parts, and accessories. The adjusted trial balance data given below is from the firms worksheet for the year ended December 31, 20X1. INSTRUCTIONS 1....
The Fashion Rack has a monthly accounting period. The firms chart of accounts is shown below. All transactions are recorded in a general journal. Postings are made from the general journal to the...
Bought an old van for 4000 from Peters promising to pay laterwhat is the transactions
Company has a following trade credit policy 1/10 N45. If you can borrow from a bank at 9,5% annual rate, would it be beneficial to borrow money and pay off invoices earlier?
Given the following exchange rates, which of the multiple-choice choices represents a potentially profitable inter-market arbitrage opportunity? 129.87/$1.1226/$0.00864/ 114.96/ B $0.8908/ (C)...

Why is using the Purchases Returns and Allowances account preferred to crediting these transactions to Purchases?

Question:

Step by Step Answer:

Provides a separate record for purchases and purchases returns If the company wants to kn...View the full answer

College Accounting A Contemporary Approach

Students also viewed these Accounting questions