I Have An Accounting Problem, Any Ideas?

Hushpuppy company purchased merchandise on account from a supplier for $6750,terms 2/10, n/30. Hushpuppy company returned $1500 of the merchandise and received full credit.
a. If hushpuppy company pays the invoice within the discount period, what is the amount of cash required for the payment?
b. under a perpetual inventory system, what account is credited by hushpuppy company to record the return?

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One Response to “I Have An Accounting Problem, Any Ideas?”

  1. Old Guy says:

    a)
    Purchase cost 6,750
    Minus return (1,500)
    Amount due before discount 5,250
    Minus 2% discount (105)
    Cash payment 5,145
    b)
    Inventory. The full entry is:
    Debit Accounts Payable
    Credit Inventory

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