Using a perpetual inventory system, the seller's journal entry to record the return, by the buyer, of merchandise purchased on account includes a:
A) Credit to Purchases Returns
B) Debit to Sales Returns and Allowances
C) Debit to Accounts Receivable
D) Debit to Cost of Goods Sold

Question

Quizplus · Accepted Answer

Under a perpetual inventory system, when a buyer returns merchandise to the seller, the following entry is made by the seller:
Sales returns and allowances XXX
$\quad $ $\quad $ $\quad $ $\quad $ $\quad $ $\quad $ Accounts receivable XXX
Inventory XXX
$\quad $ $\quad $ $\quad $ Cost of goods sold XXX

Using a Perpetual Inventory System, the Seller's Journal Entry to Record