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

A) debit to Cost of Goods Sold
B) credit to Accounts Payable
C) credit to Inventory
D) credit to Sales

Perpetual Inventory System

An inventory management method where inventory quantities and costs are updated continuously with each sale or purchase.

Accounts Payable

Liabilities of a business that are owed to creditors for goods and services purchased on credit.

Credit To Inventory

An accounting entry that increases the inventory asset account due to purchases on credit.