The entry to record payment of a voucher, for an invoice after the discount period, under the net method and the periodic inventory system will include:
A) a debit to Purchase Discounts.
B) a credit to Purchase Discounts.
C) a debit to Discounts Lost.
D) None of these is correct.

Question

Quizplus · Accepted Answer

Under the net method, if the payment is made after the discount period, the discount is considered lost and recorded as an expense. Therefore, a debit to Discounts Lost is made.

The Entry to Record Payment of a Voucher, for an Invoice