Use the following information for questions Tuck Corp.records purchases at net amounts.On May 5, Tuck purchased merchandise on account costing $8,000 (gross), terms 2/10, n/30.Tuck returned $700 of the May 5 purchase and received credit on account.At May 31 the balance had not been paid.
-The amount to be recorded as a purchase return is
A)$714.
B)$700.
C)$686.
D)$630.

Question

Quizplus · Accepted Answer

The purchase return should be recorded at the net amount. The original purchase was $8,000 with a 2% discount, so the net purchase was $7,840. The return of $700 should also be recorded at the net amount, which is $700 less 2% discount, resulting in $686.

Use the Following Information for Questions Tuck Corp