On May 16, Bennion Company, sold $50,000 of inventory to Bonaccorsi, Inc. for $10,000 cash and $60,000 on credit. On June 10, Bonaccorsi, Inc. paid Bennion Company cash for the $60,000 credit sale. The entry by Bennion Company to record the transaction on May 16 would include

Question

Quizplus · Accepted Answer

The entry by Bennion Company to record the sale of inventory to Bonaccorsi, Inc. would include a debit to Accounts Receivable for $60,000 and a credit to Sales Revenue for $60,000. This is because the inventory was sold on credit for $60,000. The cash received for $10,000 would require a credit to cash, but it is not part of the original transaction involving the sale of inventory. The cost of goods sold is not relevant at this point in the transaction.

On May 16, Bennion Company, Sold $50,000 of Inventory to Bonaccorsi