Bethany Industries purchased $3,000 of merchandise inventory,paying cash for 20% of the purchase,with the remainder on account.The entry would include a

Question

Quizplus · Accepted Answer

The entry would include a debit to Merchandise Inventory for the full amount of $3,000, credit to Cash for the amount paid in cash ($600), and credit to Accounts Payable for the remaining balance ($2,400). This reflects that Bethany Industries paid for a portion of the inventory in cash and still owes the remainder to the supplier. Choice A is incorrect because it includes a debit to Cash for the full amount, which did not happen. Choice B includes a debit to Notes Payable, which is not mentioned in the scenario. Choice C includes a credit to Notes Payable, which is also not mentioned in the scenario. Choice E only reflects the cash payment and does not account for the remainder owed on account.

Bethany Industries Purchased $3,000 of Merchandise Inventory,paying Cash for 20