Question: Exhibit 5-3 Use the facts presented below to answer the questions that follow. Rock Sports, Inc. purchased merchandise from Safety Merchandisers Corp. on June

Exhibit 5-3 Use the facts presented below to answer the questions that

Exhibit 5-3 Use the facts presented below to answer the questions that follow. Rock Sports, Inc. purchased merchandise from Safety Merchandisers Corp. on June 5, 2004, which was shipped the same day. The merchandise's selling price was $20,000. The credit terms were 2/10, n/30. The shipping terms were FOB destination point. Rock Sports received the merchandise on June 10, 2004. Rock Sports paid the amount due on June 30, 2004. If Rock Sports uses the periodic inventory system, what economic effects are recorded by Rock Sports for the merchandise purchase on June 5, 2004? Select one O a Assets and owners' equity increase. O b. Liabilities and assets decrease. Oc Liabilities increase and owners' equity decreases Od Assets and liabilities increase.

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