The entry to record a purchase of $2,000 on account, terms of 2/10, n/30, would include a
A) debit to Inventory for $40.
B) credit to Accounts Payable for $2,000.
C) debit to Accounts Payable for $2,000.
D) credit to Cash for $2,000.

Question

Quizplus · Accepted Answer

The correct entry for purchasing inventory on account includes debiting Inventory and crediting Accounts Payable for the full amount of the purchase, which is $2,000 in this case. The terms 2/10, n/30 are payment terms and do not affect the initial recording of the transaction.

The Entry to Record a Purchase of $2,000 on Account