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Meteor Co. purchased merchandise on March 4, 2016, at a price of $42,000, subject to credit terms of 3/10, n/30. Meteor uses the net method for recording purchases and uses a periodic inventory system.
1. Prepare the journal entry to record the purchase.
2. Prepare the journal entry to record the appropriate payment if the entire invoice is paid on March 11, 2016.
3. Prepare the journal entry to record the appropriate payment if the entire invoice is paid on April 2, 2016.
Examine accounting principles and concepts used in businesses
On January 1, 2014, Derek Company had Accounts Receivable $139,000, Notes Receivable $30,000, and Allowance for Doubtful Accounts $13,200. The note receivable is from Kaye Noonan Company. It is a 4-month, 12% note dated December 31, 2013. Derek Co..
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