A company pays an invoice early and takes 4% off the original invoice price. The account to be credited for this amount under a perpetual inventory is
A. Cash
B. Discount
C. Account payable
D. Inventory

Quote:

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Originally Posted by MUNA2NE1

A company pays an invoice early and takes 4% off of the original invoice price. The account to be credited for this amount under a perpetual inventory is
A. Cash
B. Discount
C. Account payable
D. Inventory

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What do you think?

I think is C. but not sure can please tell me which one is right this is due today

Wrong, the account to be credited is discount (received)

Accounts payable was debited with the full amount when the account was paid, no amount remains owing.
Ie the three accounts involved are
Accounts payable gross amount of the account Debit
Discount credit
Cash net amount credit