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Which entries would be made to record a sale

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Problem 1: A company uses the perpetual inventory method. Which of the following entries would be made to record a sale of merchandise on account?

A) The accounting entry would be a debit to Accounts Receivable and a credit to Sales Revenue.

B) The accounting entry would be a debit to Sales Revenue and a credit to Accounts Receivable.

C) The accounting entry would be a debit to Cost of Goods Sold and a credit to Inventory.

D) Both A and C would be necessary to record the sale.

Problem 2: A company uses the perpetual inventory method. Which of the following entries would be made to record a $1,200 sale of merchandise on account? The merchandise had cost the company $800.

A) The accounting entry would be a $1,200 debit to Cost of Goods Sold and a $1,200 credit to Sales Revenue.

B) The accounting entry would be a $800 debit to Cost of Goods Sold and a $800 credit to Inventory.

C) The accounting entry would be a $1,200 debit to Accounts Receivable and a $1,200 credit to Sales Revenue.

D) Both B and C would be necessary to record the sale

Reference no: EM132792950

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