Assuming That the Net Price Method of Recording Purchases Is

Multiple Choice

Assuming that the net price method of recording purchases is used and that the business uses the perpetual method of inventory recording, the correct entry to record the purchase of goods for $5000 on credit, with terms of 2/10, n/30 is: (ignore GST) .

A) DR Inventory $5000; CR Accounts payable $5000
B) DR Inventory $4900; CR Accounts payable $4900
C) DR Inventory $4900; DR Discount allowed $100: CR Accounts payable $5000
D) DR Purchases $5000; CR Accounts payable $4900; CR Discount allowed $100