The Wheatland Company purchased merchandise on account from a supplier for $18,4

Question

The Wheatland Company purchased merchandise on account from a supplier for $18,400, terms 1/10, n/30. The Wheatland Company returned $2,200 of the merchandise and received full credit.

a. What is the amount of cash required for the payment within the discount period?
$

b. Under a perpetual inventory system, what account is credited by The Wheatland Company to record the return?

- Accounts receivable

-Cost of merchandise sold

- Credit card expense

- Delivery expense

- Merchandise inventory

- Sales

Explanation / Answer

a What is the amount of cash required for the payment within the discount period? (18400-2200)*1% 162 18400-2200-162 16038 Accounts payable 16200 Cash 16038 Merchandise inventory 162 b Under a perpetual inventory system, what account is credited by The Wheatland Company to record the return? Merchandise inventory 2200 Accounts Payable 2200 Merchandise Inventory 2200

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