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    Freeman's Invoice Payment

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    M. Freeman received an invoice from D. Wayans Reproduction Automotive Parts. The invoice stated the total of $52,000 for twelve pairs of Corvette fenders with the terms 2/10, n/30 printed at the bottom.

    Please use the information in the preceding question regarding M. Freeman's purchase of auto parts from D. Wayans.
    If Freeman utilizes the perpetual inventory method and pays their invoice, utilizing the discount noted in the terms, what would be the journal entry to record the payment?
    M. Freeman Automotive Repair Item
    Account Name/Post Ref/Debit/Credit
    1.
    Cash
    $52,000
    Merchandise Inventory
    $52,000
    2.
    Accounts Payable
    $52,000
    Merchandise Inventory
    $1,040
    Cash
    $50,960
    3.
    Accounts Payable
    $44,200
    Cash
    $36,400
    Discount on Accounts Payable
    $7,800
    4.
    Accounts Payable
    $44,200
    Cash
    $44,200

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    https://brainmass.com/economics/finance/freemans-invoice-payment-462501

    Solution Preview

    2.
    Accounts Payable
    $52,000
    Merchandise Inventory ...

    Solution Summary

    The expert uses the information in the preceding question regarding M. Freeman's purchase of auto parts from D. Wayans.
    If Freeman utilizes the perpetual inventory method and pays their invoice, utilizing the discount noted in the terms, what would be the journal entry to record the payment is provided.

    $2.19