Question

A company using the perpetual inventory system purchased inventory worth $ 540 000 on account with credit terms of 2​/15, ​n/45. Defective inventory of $ 50 000 was returned 3 days​ later, and the accounts were appropriately adjusted. If the company paid the invoice 25 days​ later, the journal entry to record the payment would be​ ________.

a. 540,000 debit to accounts payable and $540,000 credit to cash

b. 540,000debit to accounts payable , $540,200 credit to cash and $9,800 credit to merchandise inventory

c. $499,800 debit to accounts payable, $9,800 credit to merchandise inventory, and $490,000 credit to cash

D. $490,000 debit to accounts payable and $490,000 credit to cash

Answer 1

Answer is D. $ 490000 debit to Accounts Payable and $ 490000 credit to cash.
Explanation:
Net amount payable:
Gross purchase		540000
Less: Return		50000
Net amount due		490000
As the payment is after 15 ays, therefore, the full amount due is payable