Which of the following is the correct journal entry for a return of goods that were purchased on account under the periodic inventory system?

Question

Quizplus · Accepted Answer

The correct journal entry for a return of goods purchased on account under the periodic inventory system is to debit Accounts Payable for the amount of the return and credit Purchase Returns and Allowances for the same amount. Choice C shows this with a debit to Accounts Payable for $500 and a credit to Purchase Returns and Allowances for $500. Choices A, B, and D do not reflect the correct accounts and/or amounts.

Which of the Following Is the Correct Journal Entry for a Return