Ace Inc. is a merchandiser which uses the perpetual inventory system. It had the following transactions occur during September:
Sept 1: Purchased inventory costing $8,000 on account, terms 3/15, n/30.
Sept 10: Paid for the inventory previously purchased on Sept 1.
Prepare the journal entries to record these two transactions.
Perpetual Inventory System:
Perpetual inventory systems is one of the two inventory systems method where inventories are tracked from time to time (i.e., upon purchase or sale). The "Merchandise Inventory" account is used for purchases instead of the account "purchases".
Answer and Explanation: 1
|Sept. 10||Accounts payable||8,000|
|Cash (8,000 *...|
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fromChapter 1 / Lesson 15
Learn about the perpetual inventory system and how it is used. Explore the advantages of perpetual inventory systems and compare perpetual vs. periodic inventory.