When a customer buys services on account,it should be recorded as:
A)a debit to Cash and a credit to Accounts Receivable.
B)a credit to Revenue and a debit to Accounts Receivable.
C)a credit to Deferred Revenue and a debit to Inventory.
D)a debit to Cash and a credit to Accounts Payable.

Question

Quizplus · Accepted Answer

When a customer buys services on account, it means they are purchasing services on credit, and the company will record this as a credit to Revenue (or the specific accounts that would be credited for the sale) and a debit to Accounts Receivable (or the specific accounts that would be debited for the sale). This reflects that the company has earned revenue, but has not yet received cash payment for it. Therefore, option B is the correct answer.

When a Customer Buys Services on Account,it Should Be Recorded