Select all that apply

Identify the statements below which summarize what cash discounts are.

Sellers can grant a cash discount to encourage buyers to pay earlier.

A reduced payment applies to the credit period.

A reduced payment applies to the discount period.

Cash discounts are described in the credit terms.

A buyer views a cash discount as a purchase discount.

A seller views a cash discount as a purchase discount.

A seller views a cash discount as a sales discount.

Multiple Select Question

Select all that apply

LOL Music Store uses the perpetual inventory system to account for its merchandise. On November $17,$ it purchased $$1,000$ of merchandise with terms of $\frac{2}{5},$

$\frac{n}{60}.$ If payment is made on December $21,$ demonstrate the required journal entry to record the payment by selecting all of the correct actions below. $($Check all

that apply.$)$

Debit Accounts Payable $$1,000.$

Credit Merchandise Inventory $$20.$

Credit Accounts Payable $$1,000.$

Credit Cash $$980.$

Credit Cash $$1,000.$