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

A company that uses the perpetual inventory system purchased inventory for $1,130,000 on account with terms of 5​/7, n/20. Which of the following correctly records the payment made 15 days after the date of​ invoice?   A. Accounts Payable 1,130,000        Merchandise Inventory   1,130,000   B. Accounts Payable 1,130,000        Merchandise Inventory   56,500      Cash   1,073,500   C. Accounts Payable 1,130,000        Cash   1,130,000   D. Cash 1,130,000        Accounts Payable   1,130,000

Vaughn Limited, which uses a perpetual inventory system, purchased inventory costing $22,000 on February 1 by issuing a 3-month note payable bearing interest at 6%, with interest and principal due on May 1. The company's year end is on March 31 and the company records adjusting entries only at that time. (a) Your answer is correct. Prepare the journal entry to record the purchase of inventory on February 1. (Credit account titles are automatically indented when the amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter O for the amounts. List debit entry before credit entry.) (b) Date Account Titles Feb. 1 Inventory Notes Payable eTextbook and Media List of Accounts Mar. 31 Date Account Titles Debit 22000 Debit Credit Prepare the journal entry to record the accrual of interest expense on March 31. (Credit account titles are automatically indented when the amount is entered. Do not indent manually. If no entry is required,…

Riley Kilgo Inc. purchased inventory costing $100,000 and sold 80% of the goods for $240,000. All purchases and sales were on account. Kilgo later collected 20% of the accounts receivable. Journalize these transactions for Kilgo, which uses the perpetual inventory system. For these transactions, show what Kilgo will report for inventory, revenues, and expenses on its financial statements. Report gross profit on the appropriate statement.