Under the periodic inventory system, which of the following entries is prepared at the end of the accounting period?
a. debit purchases and credit cost of goods sold
b. debit cost of goods sold and credit inventory
c. debit cost of goods sold and credit purchases
d. b and c

Garcia industries has sales of $200,000 and accounts receivable of $18,500, and it gives its customers 25 days to pay. the industry average dso is 27 days, based on a 365-day year. if the company changes its credit and collection policy sufficiently to cause its dso to fall to the industry average, and if it earns 8.0% on any cash freed-up by this change, how would that affect its net income, assuming other things are held constant? a. $241.45b. $254.16c. $267.54d. $281.62e. $296.44