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Doornbos Company purchased $120,000 of inventory on October 19, 2017. The invoice offered credit terms...

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Accounting

Doornbos Company purchased $120,000 of inventory on October 19, 2017. The invoice offered credit terms of 2/10, net 30. Assume the company uses a perpetual inventory system.

a) assume the invoice was paid October 25, 2017. Account for the purchase and payment using the gross method of recording purchase discounts.

b) assume the invoice was paid November 10, 2017. Account for the purchase and payment using the net method of recording purchase discounts.

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