To update the inventory records for the sale of merchandise under a perpetual inventory system, the entry would include a:
A)debit to Inventory.
B)credit to Accounts Payable.
C)debit to Sales Revenue.
D)debit to Cost of Goods Sold.

Question

Quizplus · Accepted Answer

Under a perpetual inventory system, when merchandise is sold, the cost of the goods sold is transferred from Inventory to Cost of Goods Sold. Therefore, Cost of Goods Sold is debited to reflect the increase in expense.

To Update the Inventory Records for the Sale of Merchandise