Tangent Corporation sold a product for $7,150 to Michael on credit. The cost of goods sold is $5,650.Assuming that the firm is following a perpetual inventory system and using a sales journal, it will record $5,650 in the:
A)Accounts Receivable DR, Sales Revenue CR column.
B)Cost of Goods Sold DR, Merchandise Inventory CR column.
C)Merchandise Inventory DR, Cost of Goods Sold CR column.
D)Sales Revenue DR, Accounts Receivable CR column.

Question

Quizplus · Accepted Answer

In a perpetual inventory system, the cost of goods sold is recorded by debiting the Cost of Goods Sold account and crediting the Merchandise Inventory account.

Tangent Corporation Sold a Product for $7,150 to Michael on Credit