On May 1,Garcia Corporation bought $10,000 of merchandise from Morris Corporation,terms 4/10,n/30.Garcia paid the invoice on May 6.The company uses the periodic and voucher systems.The journal entry to record the payment under the net method would be to:

Question

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Under the net method, the company records the purchase at the net amount (after deducting the discount) and pays the net amount within the credit period. In this case, the purchase was $10,000 and the discount was 4% of $10,000 = $400. Therefore, the net amount due was $9,600 ($10,000 - $400). When the payment is made, the company would debit Vouchers Payable $9,600 and credit Cash $9,600.

On May 1,Garcia Corporation Bought $10,000 of Merchandise from Morris