Which of the following statements is correct?
A) The purchase requisition is the form sent to a supplier to order goods.
B) The Purchases account is reported as an asset on the balance sheet.
C) To the customer,a supplier's invoice is a purchase order invoice.
D) The credit terms,2/10,n/30,allow the customer to take a 2 percent discount if payment is made within 10 days of the invoice,otherwise payment is due in full in 30 days.

Question

Quizplus · Accepted Answer

The credit terms, 2/10, n/30, means that the customer can take a 2% discount if payment is made within 10 days of the invoice, otherwise payment is due in full in 30 days. The other statements are incorrect: A) A purchase requisition is an internal document used by an organization to request items needed for the business, while a purchase order is the form sent to a supplier to order goods. B) The Purchases account is reported as an expense on the income statement, not as an asset on the balance sheet. C) A supplier's invoice is a document sent by the supplier to the customer to request payment for goods or services already received or delivered, while a purchase order is a document sent by the customer to the supplier to request goods or services.

Which of the Following Statements Is Correct