Mack Industries Uses the Periodic Inventory System

Multiple Choice

Mack Industries uses the periodic inventory system. What is the entry to record $250 of returned merchandise, with a cost of $100, from customer Jake Sanders?

A) Debit Sales Returns & Allowances for $250; credit Accounts Receivable for $250; debit Merchandise Inventory for $100; credit Cost of Goods Sold for $100.
B) Debit Sales Returns & Allowances for $250; credit Accounts Receivable for $250; debit Purchases for $100; credit Purchase Returns & Allowances for $100.
C) Debit Sales Returns & Allowances for $250; credit Cash for $100; credit Sales for $150.
D) Debit Sales Returns & Allowances for $250; credit Accounts Receivable for $250.