Periodic Inventory - Freight Costs Video Lessons

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Problem: Cainas Cookies places an order with Publix for ingredients on 10/29 for $300. Publix ships these on 10/31 and they arrive on 11/2, terms 1/10, n/30, FOB shipping point. Cainas pays for these on 11/5. Assuming periodic inventory system, what journal entry should Cainas make on 10/31? a. Debit: Inventory $300 and Credit: A/P $300 b. Debit: Purchases $300 and Credit: A/P $297 and Purchase discounts $3 c. Debit: Purchases $300 and Credit: A/P $300 d. Debit: Inventory $300 and Credit: A/P $297 and Credit: Purchase discounts $3

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Problem Details

Cainas Cookies places an order with Publix for ingredients on 10/29 for $300. Publix ships these on 10/31 and they arrive on 11/2, terms 1/10, n/30, FOB shipping point. Cainas pays for these on 11/5. Assuming periodic inventory system, what journal entry should Cainas make on 10/31?

a. Debit: Inventory $300 and Credit: A/P $300

b. Debit: Purchases $300 and Credit: A/P $297 and Purchase discounts $3

c. Debit: Purchases $300 and Credit: A/P $300

d. Debit: Inventory $300 and Credit: A/P $297 and Credit: Purchase discounts $3

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