Final answer:
When a company purchases inventory on their credit card, it affects the Inventory and Credit Card/Payable accounts on the Chart of Accounts.
Step-by-step explanation:
When a company purchases inventory on their credit card, it affects two accounts on the Chart of Accounts: the Inventory account and the Credit Card/Payable account.
The purchase increases the Inventory account because the company now has more items in stock that they can sell to customers. At the same time, it increases the Credit Card/Payable account as the company now owes money to the credit card company for the purchase.
For example, if a company buys $1,000 worth of inventory on their credit card, the Inventory account will increase by $1,000 indicating they have more stock available, and the Credit Card/Payable account will increase by $1,000 representing the debt owed to the credit card company.