Question

On July 22, a company purchased merchandise inventory at a cost of $6,000 with credit terms 2/10, net 30. If the company pays for the purchase on August 7, what would be the appropriate journal entry?

Answer 1

The appropriate journal entry is:

Dr: Account Payable $6,000

Cr: Bank/Cash $ 6,000

Step-by-step explanation:

The entry is recorded by Net amount as the 2% discount on Net price was allowed if payment is made within 10 days of purchase date of July 22,

but as the payment is made in August 7, no discount is allowed.

So the whole net amount of $ 6,000 need to be paid.