On April 1, 2019 Maudlin Sales purchased inventory for $80,000 by signing a one-year note payable, due March 31, 2020. The note bears interest at an annual rate of 8%.
What is the correct journal entry to record the purchase of inventory if Maudlin Sales uses a periodic inventory system?
A) Inventory 80,000 Notes payable 80,000
B) Purchases 80,000 Notes payable 80,000
C) Purchases 86,400 Accounts payable 86,400
D) Inventory 86,400 Notes payable 86,400