On August 1, Baker Brothers bought goods with a list price of $19,200, terms 2/10, n/30. The firm records purchases at invoice price, using the periodic inventory system. On August 5, Baker Brothers returned goods with a list price of $2,400 for credit.
If Baker Brothers paid the supplier the amount due on August 9, the appropriate entry would be:
A) Accounts Payable$\quad $ 19,200
$\quad $ $\quad $ $\quad $ $\quad $ $\quad $ Purchases Discounts $\quad $ 384
$\quad $ $\quad $ $\quad $ $\quad $$\quad $ $\quad $ Cash$\quad $ 18,816
B) Accounts Payable$\quad $ 18,464
$\quad $ $\quad $ $\quad $ $\quad $ $\quad $ $\quad $ Cash $\quad $ $\quad $ 18,464
C) Accounts Payable 16,800
$\quad $ $\quad $ $\quad $ $\quad $ $\quad $ Purchases Discounts $\quad $ 336
$\quad $ $\quad $ $\quad $ $\quad $ $\quad $ Cash $\quad $ 16,464
D) Accounts Payable $\quad $ 16,800
$\quad $ $\quad $ $\quad $ $\quad $ $\quad $ $\quad $ Cash $\quad $ 16,800

Question

On August 1, Baker Brothers bought goods with a list price of $19,200, terms 2/10, n/30. The firm records purchases at invoice price, using the periodic inventory system. On August 5, Baker Brothers returned goods with a list price of $2,400 for credit.
If Baker Brothers paid the supplier the amount due on August 9, the appropriate entry would be:
A) Accounts Payable$\quad $  19,200
$\quad $ $\quad $ $\quad $ $\quad $ $\quad $ Purchases Discounts $\quad $ 384
$\quad $ $\quad $ $\quad $ $\quad $$\quad $ $\quad $  Cash$\quad $  18,816
B) Accounts Payable$\quad $  18,464
$\quad $ $\quad $ $\quad $ $\quad $ $\quad $ $\quad $ Cash $\quad $ $\quad $ 18,464
C) Accounts Payable 16,800
$\quad $ $\quad $ $\quad $ $\quad $ $\quad $ Purchases Discounts $\quad $ 336
$\quad $ $\quad $ $\quad $ $\quad $ $\quad $ Cash $\quad $ 16,464
D) Accounts Payable $\quad $ 16,800
$\quad $ $\quad $ $\quad $ $\quad $ $\quad $ $\quad $ Cash $\quad $ 16,800

Quizplus · Accepted Answer

Baker Brothers records the following entries:
August 1: Purchases$\quad $ $\quad $  $19,200
$\quad $ $\quad $ $\quad $ $\quad $ $\quad $ Accounts payable $19,200
To record purchase of goods on credit
August 5: Accounts payable$\quad $  $2,400
$\quad $ $\quad $ $\quad $ $\quad $ $\quad $ $\quad $ Purchase returns $\quad $ $2,400
To record purchase returns
August 9: Accounts payable $\quad $ $16,800
$\quad $ $\quad $ $\quad $ $\quad $ $\quad $ $\quad $ Purchase discounts$\quad $  $ 336
$\quad $ $\quad $ $\quad $ $\quad $ $\quad $ $\quad $ $\quad $ Cash $\quad $ $\quad $ $\quad $ $\quad $ $16,464
To record purchase discount and payment

On August 1, Baker Brothers Bought Goods with a List \quad

On August 1, Baker Brothers Bought Goods with a List $\quad$