On July 10,a hardware retailer purchased merchandise inventory on account for $1300.The company plans to pay $1000 the following week and the remaining amount the week after.Which of the following is the correct entry to record the July 10 transaction in a purchases journal? Assume a perpetual inventory system is used.
A)$1000 will be recorded in the Accounts Payable CR and Merchandise Inventory CR columns.
B)$2300 will be recorded in the Accounts Payable DR and Merchandise Inventory DR columns.
C)$1300 will be recorded in the Merchandise Inventory CR and Accounts Payable DR columns.
D)$1300 will be recorded in the Accounts Payable CR and Merchandise Inventory DR columns.

Question

Quizplus · Accepted Answer

In a perpetual inventory system, the purchase of inventory on account is recorded by debiting Merchandise Inventory and crediting Accounts Payable for the full amount of $1300.

On July 10,a Hardware Retailer Purchased Merchandise Inventory on Account