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Financial Accounting

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Moderate

Periodic Inventory System Purchase Discount

FINACT-Y1WXNP

UniqueBooks Inc. used the periodic inventory system and had the following transactions during February 2015.

2/1 Purchased \$100 in inventory with cash and paid shipping expenses \$75 for the purchase
2/9 Purchased \$500 in inventory on account, with credit terms of 1/10, n/30
2/15 Paid for the purchase on 2/9 after the discount

(I): On 2/1, which account should PenWarehouse debit when recording the shipping charges?

(II): On 2/15, which account should the company use to recognize the discount?

(III): On 2/15, how much cash should the company pay?