An Electronics Retailer Purchases $20,000 of Computers for Resale

Multiple Choice

An electronics retailer purchases $20,000 of computers for resale.The retailer spends $500 in cash for transportation cost.Under a perpetual inventory system the journal entry to record the purchase will include:

A) $20,500 will be debited to Inventory,$20,000 will be credited to Accounts Payable,and $500 will be credited to Cash.
B) $20,000 will be debited to Inventory and $20,000 will be credited to Cash.
C) $20,000 will be credited to Inventory and $20,000 will be credited to Purchases.
D) $20,500 will be debited to costs of goods sold and $20,500 will be credited to Accounts Payable.