Massachusetts Institute Of Technology Operations And Supply Chain Management Assignment Help - The Martin Company
Question - The Martin Company had the following transactions. (Assume the perpetual inventory method is used.) Event a: The Company purchased $5,000 of merchandise on account under terms 2/10, n/30. Event b: The Company returned $600 of merchandise to the supplier before payment was made. Event c: The liability was paid within the discount period. Event d: All of the merchandise purchased was sold for $6,500 cash. What effect will the return of merchandise to the supplier have on the accounting equation? a. Assets and equity are reduced by $600. b. Assets and liabilities are reduced by $570. c. Assets and liabilities are reduced by $600. d. Liabilities and equity are reduced by $600.
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