Using a perpetual inventory system, the purchase of inventory on account would be recorded as a. Debit Cost of Goods Sold; credit Inventory.b. Debit Inventory; credit Sales Revenue.c. Debit Purchases; credit Accounts Payable.d. Debit Inventory; credit Accounts Payable.

Q: Which of the following is the correct journal entry for a return of goods that were purchased on…

A: As periodic inventory system purchases and sales are used instead of merchandise inventory.

Q: der the periodic inventory system, all increases and decreases in inventory, such as purchases,…

A: Solution: False.  Under periodic inventory system Daily inventory records are not maintained.

Q: The entry to record inventory shrinkage under a perpetual inventory system would include a debit to:…

A: Explanation: When There is Inventory shrinkage Under the perpetual inventory system The following…

Q: When merchandise purchased on account is returned under the perpetual inventory system, the buyer…

A: The journal entries are prepared to keep the record of day to day transactions of the business.

Q: In the Perpetual/Periodic Inventory System what are the merchandise inventory and Income summary?…

A: Perpetual inventory: Under perpetual inventory system each transaction for purchase of inventory,…

Q: Identify whether each description best applies to a periodic or a perpetual inventory system.…

A: Perpetual inventory system: Perpetual Inventory System refers to the inventory system that maintains…

Q: True or False Merchandise inventory is reported in the long-term assets section of the statement of…

A: Long-term assets:                            Long-term assets are those assets called noncurrent…

Q: the inventory system employing accounting records that continuously disclose the amount of inventory…

A: For the purpose of cost accounting in business, records are being kept for each and every category…

Q: Under the perpetual inventory system, increases and decreases in inventory are recorded through the…

A: Solution: Under perpetual inventory system, inventory records are updated with every purchase and…

Q: Merchandise inventory is classified on the balance sheet as a a. current liability b. current…

A: Assets can be classified as current asset and long-term assets. Liabilities can be classified as…

Q: What is the effect of an entry to record the purchase of inventory on account under the perpetual…

A: Under the perpetual inventory system, purchases are directly debited to the "Inventory account". And…

Q: The amount shown in the balance sheet debit column of worksheet for Merchandise Inventory​ is:   A.…

A: Merchandise inventory: It can be defined as any type of manufactured goods that are acquired by the…

Q: Which journal entry is correct when there is a sale under a perpetual inventory and FOB shipping…

A: Solution- Accounts payable -------------------DR                 To Merchandise inventory. (To…

Q: What account is debited when recording a purchase of inventory when using the perpetual inventory…

A: Perpetual inventory system: The method or system of maintaining, recording, and adjusting the…

Q: Under periodic inventory system, when there is purchase return then: Inventory will be debited…

A: Answer  A periodic inventory system only updates the closing inventory balance in the general ledger…

Q: The journal entry to record the return of inventory purchased on credit under a periodic inventory…

A: One of the main feature of periodic system of inventory is all the adjustments are made at end of…

Q: Mcq In a perpetual inventory system, the amount of the discount allowed for paying for merchandise…

A: Perpetual inventory system is an inventory system in which all transactions related to inventory are…

Q: 1. Under the perpetual inventory system, in addition to making the entry to record a sales return, a…

A: Note: “Since you have asked multiple question, we will solve the first question for you. If you want…

Q: his account is used to recognize the cost of an inventory that is sold as expens

A: Solution: When inventory is sold, then this cost should be transferred to Cost of goods sold…

Q: Cost of goods sold is debited each time a sale is made under which of the following inventory…

A: The carrying value of the goods that are sold during a given period of time are termed as cost of…

Q: What is the method of accounting of inventory in which the cost of goods is recorded each time a…

A: The cost of goods included the cost of goods that are sold during the period.

Q: Under the perpetual inventory system, in addition to making the entry to record a sale, a company…

A: Under perpetual inventory system, the decrease in inventory is also recorded every time of sale.

Q: The two main inventory accounting systems are the a. perpetual and periodic. b. purchase and sale.…

A: Purchase and sale are the transaction made by the company. It is not an inventory system. Returns…

Q: A company that uses a perpetual inventory system purchased inventory on account and later returned…

A: Perpetual inventory system: It is a method of inventory management that records real time…

Q: n perpetual method, _______________ will be credited if an item bought will be returned.    Cost of…

A: In perpetual method, Merchandise Inventory will be credited if an item bought will be returned. Cost…

Q: Income Summary is closed to what account Income accounts O Expense Accounts Owner's equity account O…

A: all the incomes and expenses are closed by transferring the accounts to the income statement. The…

Q: Which of the following is incorrect about the perpetual inventory method? a. purchases are…

A: Perpetual inventory method : Perpetual inventory method records real time transactions of inventory…

Q: Is purchases is the account to be debited upon purchase of merchandise under the perpetual inventory…

A: Perpetual Inventory System It is the most important part of the business to enter the transactions…

Q: When recording purchase returns and purchase allowances under the periodic inventory system, what…

A: Periodic Inventory System:Periodic inventory system is a system in which the inventory is updated…

Q: Explain how the sale of inventory on account is recorded under a periodic system. How does this…

A:

Q: Based on the information, Determine the adjusted balances of Inventory,Accounts…

A: Adjusted balance can be defined as those amount of balance determined after the closure of books. It…

Q: A perpetual inventory system will always give updated balances for: Goods Available for Sale and…

A: Perpetual inventory system is a type of inventory system in which all transactions related to…

Q: What account is debited when recording a purchase of inventory when using a periodic inventory…

A: Periodic inventory system: The method or system of recording the transactions related to inventory…

Q: The journal entry to write inventory up to the net realizable value would be​ _______. a) a debit to…

A: SOLUTION- INVENTORY IS AN ASSET AND TO WRITE UP INVENTORY WE HAVE TO CREDIT THE INVENTORY. AS IT…

Q: In Perpetual inventory system the loss of goods is included in a. Sales b. Closing stock c.…

A: The perpetual inventory system is a type of inventory valuation in which the inventory sold and…

Q: Under the periodic inventory system, the journal entry to record the purchase of merchandise…

A: Periodic inventory system: The method or system of recording the transactions related to inventory…

Q: Identify whether each description best applies to a periodic or a perpetual inventory system.…

A: Definition: Perpetual inventory: Under the perpetual inventory system, each transaction for the…

Q: Under this inventory system, the “Inventory” account is updated each time a purchase or sale is…

A: Solution: Under perpetual inventory system, inventory is updated with every purchase and sale. Cost…

Q: If each purchase and sale of merchandise is recorded in the inventory and the cost of merchandise…

A: Under periodic inventory, no cost of goods sold is entry is recorded for every sale transaction. At…

Q: Which of the following is used to determine the cost of goods sold? a. Beginning Inventory +…

A: Net Purchases = Purchases - Purchase return - Purchase discount Direct Expenses = Freight in etc.

Q: In the periodic inventory system, all purchases of merchandise during the period is recorded on what…

A: There are two type of inventory systems in the business. One is perpetual inventory system and other…

Q: What is the treatment of the following items in connection with the retail inventory method? d.…

A: A retail business is one that buys goods in bulk from the wholesaler and sells them in smaller…

Q: Under the perpetual inventory system, in addition to making the entry to record a sale, a company…

A: In Perpetual inventory system, inventory gets updated on real time basis which means inventories are…

Q: Describe the recording process for purchases of merchandise inventory using a Perpetual inventory…

A: Under perpetual inventory system, changes in merchandise inventory account are recorded after each…

Q: What are the two journal entries involved when recording the sale of inventory when using the…

A: Perpetual inventory system refers to the inventory system that maintains the detailed records of…

Q: Which of the following statements is true for a company that uses a periodic inventory system?…

A: Only inventory account is used for all the inventory transactions in the perpetual inventory system.…

Financial Transaction Analysis

The transaction analysis is done with the help of the accounting equation. The basic accounting equation is alternatively known as the balance sheet equation is based on the double-entry system which says that for each transaction happening in a business, at least two accounts should be affected I.e. both the debit side and the credit side should be equal. The Accounting Equation is