A Company Using the Net Method of Recording Purchases Failed

Multiple Choice

A company using the net method of recording purchases failed to take advantage of a discount available. When they pay the full (gross) amount of an invoice at the end of the credit period the journal entry will include a debit to:

A) Merchandise Inventory.
B) Sales Discounts.
C) Discounts Lost.
D) Cash.
E) Accounts Receivable.