Tyler Company purchased merchandise in the amount of $4,800 from Sam's Store, with credit terms of 1/10, n/45 on October 1. Tyler uses the perpetual inventory system. On October 4, Tyler returns some of the merchandise, which were not defective, and receieved a credit memorandum for $1,500. The journal entry that Tyler makes on October 8, while paying the invoice will include:
A) Debit to Accounts Payable for $4,800
B) Credit to Merchandise Inventory $33
C) Credit Merchandise Inventory $1,500
D) Credit to Sales Returns and Allowances for $1,500
E) Credit to Cash $4,752
Answer: B) Credit to Merchandise Inventory $33
Business
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