The journal entry to record taking a discount when paying for goods previously purchased on account includes a:
A)credit to two asset accounts.
B)credit to a liability account.
C)debit to an asset account.
D)debit to an expense account.

Question

Quizplus · Accepted Answer

The journal entry includes a debit to Accounts Payable for the original cost (to decrease this liability account)and a credit to Cash for the discounted amount (to decrease this asset account)and Inventory for the amount of the discount (to decrease this asset account).

The Journal Entry to Record Taking a Discount When Paying