Asked by Germanee Foster on Apr 28, 2024
Verified
Glover Co. returned defective goods costing $5000 to Mal Company on April 19 for credit. The goods were purchased April 10 on credit terms 3/10 n/30. The entry by Glover Co. on April 19 in receiving full credit is: a.
Accounts Payable 5,000 Inventory 5,000\begin{array}{ll}\text { Accounts Payable } &5,000\\\text { Inventory }&&5,000\end{array} Accounts Payable Inventory 5,0005,000
b.
Accounts Payable 5,000 Inventory 150 Cash5,150\begin{array}{ll}\text { Accounts Payable }&5,000 \\\text { Inventory }&150\\\text { Cash}&&5,150\end{array} Accounts Payable Inventory Cash5,0001505,150
c.
Iccounts Payable 5,000 Purchase Discounts 120 Inventory 4,850\begin{array}{ll} \text { Iccounts Payable } & 5,000 \\\text { Purchase Discounts }&&120 \\\text { Inventory }&&4,850\end{array} Iccounts Payable Purchase Discounts Inventory 5,0001204,850
d.
Accounts Payable5,000 Inventory 120 Cash4,850\begin{array}{lrr} \text { Accounts Payable} &5,000\\ \text { Inventory } &&120\\ \text { Cash} &&4,850\end{array} Accounts Payable Inventory Cash5,0001204,850
Defective Goods
Items that fail to meet quality standards due to flaws or faults, rendering them unsaleable or requiring correction.
Credit Terms
Conditions under which credit is extended by a lender to a borrower, including interest rate, repayment schedule, and other terms of a credit agreement.
Accounts Payable
Amounts a company owes to its creditors for goods or services that have been delivered or used but not yet paid for.
- Implement principles of accounting to manage returns and early payment discounts in transactions involving credit sales.
Verified Answer
CS
Learning Objectives
- Implement principles of accounting to manage returns and early payment discounts in transactions involving credit sales.