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200 At the end of last year,Games-2-Use had merchandise costing $140,000 in inventory.During January of the current year,the company purchased merchandise costing $102,000,and sold merchandise that it had purchased at a total cost of $84,000.Games-2-Use uses a perpetual inventory system.
-The total amount debited to the Inventory account during January was:
A)$0.
B)$84,000.
C)$102,000.
D)$140,000.

Question

Quizplus · Accepted Answer

The total amount debited to the Inventory account during January includes the beginning inventory of $140,000 plus the merchandise purchased during the month of $102,000, which equals $242,000. Since the company uses a perpetual inventory system, the cost of goods sold is recorded as the merchandise is sold, and not as a separate transaction that debits the Inventory account. Therefore, the $84,000 cost of goods sold does not affect the total amount debited to the Inventory account during January.

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