Northern Corporation sold goods to Eastern Enterprises for $1,000 on account.Cost of goods sold was $745.Northern uses a perpetual inventory system and special journals.The cost of goods sold is recorded in the ________ column of the sales journal.

Question

Quizplus · Accepted Answer

Cost of Goods Sold is a debit account and Merchandise Inventory is a credit account. In a perpetual inventory system, cost of goods sold is recorded in the sales journal as a debit to Cost of Goods Sold and a credit to Merchandise Inventory. Therefore, the correct answer is C.

Northern Corporation Sold Goods to Eastern Enterprises for $1,000 on Account.Cost