Doughton Furniture Company purchased merchandise on credit from Furniture Supply for $8,000. Two days later Doughton returned $2,000 of the merchandise due to damage. Doughton would record the return of merchandise in the:

Question

Quizplus · Accepted Answer

The return of merchandise should be recorded in the general journal as it does not involve a cash transaction and affects multiple accounts. The entry would be a credit to Accounts Payable for $2,000 and a debit to Merchandise Inventory for $2,000.

Doughton Furniture Company Purchased Merchandise on Credit from Furniture Supply