Accounting 210 Chapter 6 LearnSmarts

X Company, which uses a perpetual inventory system, sold $2,000 of merchandise on account with credit terms of 2/10, n/30. The journal entry to record the initial sale gross of any discounts will include

A credit of Sales Revenue of $2,000 and a debit to Accounts Receivable of $2,000

What does FOB shipping point mean?

Goods are owned by the buyer when they leave the seller's place of business

Acme Enterprises, which uses a perpetual inventory system, recorder a debit to Sales Returns and Allowances and a credit to Accounts Receivable. (No other accounts were affected.) What business event must have taken place?

The customer received a damaged product, but kept the product and asked for a reduction in the price

Using a perpetual inventory system, the entry to record the return of goods you previously purchased on account includes a

debit to Accounts Payable and a credit to Inventory

The recording of a company's purchase returns and purchase allowances are similar in that both may result in a

decrease in Accounts Payable and a decrease in Inventory