When ABC Co. makes a sale of inventory on credit to XYZ Co., then a receivable is created for ABC

and XYZ's inventory is increased.

Name: When ABC Co. makes a sale of inventory on credit to XYZ Co., then a receivable is created for ABC and XYZ's inventory is increased.
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Question

When ABC Co. makes a sale of inventory on credit to XYZ Co., then a receivable is created for ABC

and XYZ's inventory is increased.

Quizplus · Accepted Answer

When ABC Co. sells inventory on credit to XYZ Co., ABC records a receivable (indicating XYZ owes ABC money), and XYZ records the inventory as an asset, thus increasing its inventory.