Financial Accounting

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Periodic Inventory System Purchase Return


Office Co. had the following transactions during March, 2015. The company used periodic inventory systems.

3/1 Purchased chair inventory on account \$7,500, term 2/10, n/30
3/3 Returned \$2,500 of the chairs purchased on 3/1 because these chairs did not pass the quality check at the warehouse

On 3/3, the company returned the product. Which account should the company debit when journalizing the transaction?