Merchandise with a list price of $7,500 and a cost $7,000 is sold on account, terms 1/10, n/30, Prior to payment, merchandise with a list price of $1,000 and a cost of $800 is returned. The correct amount is paid within the discount period?
a. Sold the merchandise. If a financial statement doesn't require an entry, select "No. Effect" and enter "0" in amount field.

b. Received the return merchandise. If financial statements doesn't require an entry, select "No effect" and enter "0" in amount field.

c. Received the amount owed. If all the financial statements doesn't require any entry. Select "No Effect" and entry "0" in amount field.

Transcribed Image Text:

Liabilities + Stockholders' Equity Assets = Cash Accounts Receivable Merchandise Inventory Accounts Payable Capital Stock Retained Earnings Statement of Cash Income Statement Flows Select Select Select Stockholders' Equity Merchandise Inventory Accounts Payable Capital Stock Retained Earnings Liabilities + Assets = Cash Accounts Receivable Statement of Cash Flows Income Statement Select Select Select