Leighton Company Uses the Perpetual Inventory Method

Multiple Choice

Leighton Company uses the perpetual inventory method.On September 6,Loughton sold merchandise to Cray Company on terms of FOB shipping point.That same day,Loughton paid $700 cash for related shipping charges.How would Leighton record this payment?

A) Debit Merchandise Inventory for $700 and credit Cash for $700.
B) Debit Delivery Expense for $700 and credit Cash for $700.
C) Debit Accounts Receivable for $700 and credit Cash for $700.
D) Debit Purchases for $700 and credit Cash for $700.
E) Debit Cost of Goods Sold for $700 and credit Cash for $700.