Darlington Company entered into the following business events during its first month of operations. The company uses the perpetual inventory system. 1) The company purchased $13,200 of merchandise on account under terms 3/10, n/30. 2) The company returned $2,700 of merchandise to the supplier before payment was made. 3) The liability was paid within the discount period. 4) All of the merchandise purchased was sold for $20,400 cash. What effect will the return of merchandise to the supplier in event (2) have on Darlington's financial statements? Multiple Choice Assets and liabilities decrease by $2,700. Assets and stockholders' equity decrease by $2,700. Assets and liabilities decrease by $2619

Darlington Company entered into the following business events during its first month of operations. The company uses the perpetual inventory system. 1) The company purchased $13,200 of merchandise on account under terms 3/10, n/30. 2) The company returned $2,700 of merchandise to the supplier before payment was made. 3) The liability was paid within the discount period. 4) All of the merchandise purchased was sold for $20,400 cash. What effect will the return of merchandise to the supplier in event (2) have on Darlington's financial statements? Multiple Choice Assets and liabilities decrease by $2,700. Assets and stockholders' equity decrease by $2,700. Assets and liabilities decrease by $2619

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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