Test: CPA Financial Accounting and Reporting (FAR)

1.

Which of the following is true regarding purchases made from a seller that offers a discount for early payment?

The purchase is recorded as a credit to accounts payable as if the discount is going to be taken, if using the net method

The purchase is recorded as a credit to accounts payable without regard for the discount, if using the net method

The purchase is recorded as a credit to accounts payable as if the discount is going to be taken, under the gross or net method

The purchase is recorded as a credit to accounts payable as if the discount is going to be taken, if using the gross method

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