A company purchased inventory for $2,000 from a vendor on account, FOB shipping point, with terms of 2/10, n/30. The company paid $100 cash for freight in. Prepare the journal entry to record payment of the invoice within 10 days by the purchaser
(Assume a perpetual inventory system.)
What will be an ideal response
Accounts Payable 2,000
Merchandise Inventory 40
Cash 1,960
You might also like to view...
The question close focuses on having the buyer make a key decision.
Answer the following statement true (T) or false (F)
In TCE, asset specificity means:
a. The degree to which an asset is specific to use or user b. The degree to which an asset can be traded c. The degree to which an asset can be valued d. None of the above
The contingency perspective refutes universal principles of management by stating that a variety of factors, both internal and external to the firm, may affect an organization's performance. Thus, according to this management approach,
A. a Gantt chart is not an appropriate tool for planning. B. planning cannot be one of the four functions of management. C. bureaucratic rules and controls are of major importance. D. there is no "one best way" to manage and organize because circumstances vary. E. external factors, internal strengths and weaknesses, and skills of managers and workers should not be considered in planning, organizing, leading, or controlling.
Indicate whether each of the following statements about financial statement analysis is true or false.________ a) Having too little inventory can hurt a company's profitability because of lost sales.________ b) Having too much inventory can hurt a company's profitability because of excess costs.________ c) Generally, a lower inventory turnover indicates that merchandise is being handled more efficiently.________ d) Average days to sell inventory is the number of times, on average, that inventory is replaced during the year.________ e) Values for the inventory turnover ratio vary widely among different industries.
What will be an ideal response?