The entry to record the cost of merchandise inventory sold involves a
A)debit to Merchandise Inventory and a credit to Sales Revenue.
B)debit to Cost of Goods Sold and a credit to Merchandise Inventory.
C)debit to Merchandise Inventory and a credit to Cost of Goods Sold.
D)debit to Cost of Goods Sold and a credit to Sales Revenue.
E)debit to Merchandise Inventory and a credit to Accounts Receivable.

Question

Quizplus · Accepted Answer

When merchandise inventory is sold, it is removed from the inventory account and transferred to the cost of goods sold account. Therefore, the entry to record the cost of merchandise inventory sold involves a debit to Cost of Goods Sold and a credit to Merchandise Inventory.

The Entry to Record the Cost of Merchandise Inventory Sold