Question

Which of the following entries would be made to record the purchase of inventory on account for​ $12,000, if a company uses the perpetual inventory​ system?
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Part 1
A.
Merchandise Inventory
​12,000
     Cash
​12,000
B.
Merchandise Inventory
​12,000
     Accounts Payable
​12,000
C.
Cash
​12,000
     Merchandise Inventory
​12,000
D.
Accounts Payable
​12,000
     Merchandise Inventory
​12,000

Answer 1

In a perpetual inventory system, when inventory is purchased on account, the appropriate journal entry would involve debiting the Merchandise Inventory account and crediting the Accounts Payable account. This reflects the increase in inventory and the obligation to pay for that inventory later.

Therefore, the correct entry for recording the purchase of inventory on account for $12,000 is:

B.
Merchandise Inventory
        $12,000
        Accounts Payable
        $12,000