Under a perpetual inventory system,merchandise returned by a customer to the seller is recorded as a ________ in the books of seller.
A)sales return
B)sales allowance
C)sales discount
D)purchase return

Question

Quizplus · Accepted Answer

Merchandise returned by a customer to the seller is recorded as a sales return in the books of the seller in a perpetual inventory system. This is because the perpetual inventory system keeps track of inventory in real-time, and recording the return as a sales return allows the system to adjust the inventory levels accordingly. Sales allowance and sales discount are also adjustments made to the sales revenue account, but they do not affect inventory levels. Purchase return, on the other hand, is recorded by the buyer when they return merchandise to the seller.

Under a Perpetual Inventory System,merchandise Returned by a Customer to the Seller