When a company uses the perpetual inventory system . A) purchases of Office Supplies and Equipment that will be used in the day-to-day operations of the business are recorded as debits to Merchandise Inventory. B) the purchase of merchandise inventory on account is recorded as a debit to Accounts Payable and a credit to Merchandise Inventory. C) the Merchandise Inventory account is reported as an expense on the income statement. D) the Merchandise Inventory account is debited for purchases of goods that the company intends to resell to customers

D) the Merchandise Inventory account is debited for purchases of goods that the company intends to resell to customers

Explanation:

Under the perpetual inventory system, the inventory should be recorded immediately when the inventory is sold or purchased.

At the time of purchase on inventory on account we debited the merchandise inventory and credited the account payable i.e

Merchandise inventory

       To Account payable

(being the inventory is purchased on account)

It increased the inventory and account payable so it is debited and credited respectively

Therefore, the last option is correct

$6,000

Explanation:

Calculation for How much difference would there have been in Franel's income with regard to the effect of the investment, between using the equity method or using the initial value method of internal recordkeeping

Using this formula

Difference in Franel's income using Equity Method = [(Net income-Dividends)-(Net income-Patent allocation amortization- Dividends)]

Let plug in the formula

Difference in Franel's income using Equity Method =[($360,000 - $190,000)-($360,000 - $6,000 - $190,000]

Difference in Franel's income using Equity Method = $170,000 -$164,000

Difference in Franel's income using Equity Method =$6,000

Therefore How much difference would there have been in Franel's income with regard to the effect of the investment, between using the equity method or using the initial value method of internal recordkeeping is $6,000