Under a periodic inventory system, purchase of merchandise is debited to the
A)Inventory account.
B)Cost of Goods Sold account.
C)Purchases account.
D)Accounts Payable account.

Question

Quizplus · Accepted Answer

Under a periodic inventory system, the purchase of merchandise is recorded by debiting the Purchases account, not the Inventory account. This system only updates the inventory balance at the end of the accounting period, not at the time of each purchase.

Under a Periodic Inventory System, Purchase of Merchandise Is Debited