Returned merchandise paid for within the discount period for cash.The perpetual inventory system is in use.This will be recorded with:

Question

Quizplus · Accepted Answer

Since the merchandise was returned within the discount period and paid for in cash, it will be recorded as a reduction in the inventory balance (debit to an asset) and an increase in the cash balance (credit to an asset). Therefore, the correct choice is B, i.e., a debit to an asset and a credit to an asset.

Returned Merchandise Paid for Within the Discount Period for Cash