The following journal entry was included in the accounting records of Jentzen Corp.: Based on this information, it is likely that the company:

Question

The following journal entry was included in the accounting records of Jentzen Corp.:  Based on this information, it is likely that the company:

Quizplus · Accepted Answer

The entry indicates a debit to Inventory and a credit to Accounts Payable. This suggests that the company paid for inventory that was previously purchased on credit. The inclusion of a discount suggests that the company paid within the discount period, resulting in a lower total purchase cost. Therefore, option B, which states that the company paid for inventory purchased on credit and took advantage of a 1% purchase discount, is likely correct.

The Following Journal Entry Was Included in the Accounting Records