Hexagon Corporation sold a product on credit for $2,235 to Merin Lynch.The cost of goods sold was $1,324.Assuming that the firm is following a perpetual inventory system and using a sales journal,it will record $2,235 in the ________.
A)Accounts Receivable CR,Sales Revenue DR column
B)Cost of Goods Sold DR,Merchandise Inventory CR column
C)Merchandise Inventory DR,Cost of Goods Sold CR column
D)Accounts Receivable DR,Sales Revenue CR column

Question

Quizplus · Accepted Answer

In a perpetual inventory system and using a sales journal, the sale of a product on credit will be recorded by debiting the Accounts Receivable account and crediting the Sales Revenue account. Therefore, the correct option is D, Accounts Receivable DR, Sales Revenue CR column. The Cost of Goods Sold is recorded separately when the merchandise is sold, which in this case is already given as $1,324. Option A, B, and C are incorrect because they do not follow the standard accounting treatment for recording sales on credit in a perpetual inventory system using a sales journal.

Hexagon Corporation Sold a Product on Credit for $2,235 to Merin