a O .O Use the following information to answer questions 5 through 7 Tesoro Corp

Question

a O .O Use the following information to answer questions 5 through 7 Tesoro Corp. Uses a perpetual inventory system. The following activities occurred during May- May 2 May 2 May 5 Tesoro purchased $180,000 worth of inventory on credit, terms 3/10.n/30 Because the terms of the purchase were FOB shipping point, Tesoro pays $4,000 to the - trucker. Tesoro returned $20,000 worth of that inventory to the supplier. Tesoro paid for the inventory - -May 9 5. The journal entry to record Tesoro's payment to the trucker on May 2ed will include a: A. debit to Freight Expense for $4,000. debit to Cost of Goods Sold for $4,000. B. C. debit to Inventory for $4,000. debit to Purchases for $4,000. D. 6. The journal entry to record Tesoro's return of merchandise on May sh will include a: A. B. C. D. E. credit to Inventory for $20,000. credit to Cost of Goods Sold for $20,000. credit to Accounts Payable for $20,000. debit to Accounts Payable for $19,400. credit to Cash for S19,400. 7. The journal entry to record Tesoro's payment for the inventory on May 9th will include a: A. debit to Purchase Discount for $4,800. B. debit to Accounts Payable for $160,000. C. credit to Cash for $174,600. D. debit to Inventory for $$,400. E. debit to Accounts Payable for $155,200. S. A company had beginning inventory of $$,000. During the month of February, the company recorded the following events Purchased merchandise for $120,000 with the terms 2/10,n/30. Paid $2,000 transportation costs on the shipment. Returned $5,000 of the merchandise. Paid the invoice within the discount period. Assuming there were no sales during the month, what is the balance in the company's Inventory account at the end of February? A. $174,300 B. $170,000 C. $169,700 D. $182,000 E. $167,700

Explanation / Answer

5) Journal entry to payment to trucker is Merchandise inventory debit to account payable credit

so answer is c) debit inventory for $4000

6) Journal entry to record return of merchandise purchase is account payable debit to merchandise inventory credit:

so answer is a) Credit to inventory for $20000

7) Journal entry to record payment is :

Account payable debit to cash and merchandise inventory credit..

so answer is b) debit account payable is $160000

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