Under the perpetual inventory system,the return of goods from a customer would increase Cost of Goods sold and decrease Merchandise Inventory.

Question

Quizplus · Accepted Answer

Under the perpetual inventory system, the return of goods from a customer would decrease Cost of Goods sold and increase Merchandise Inventory. This is because the return of goods means that the inventory that was previously sold and recognized as cost of goods sold is now back in the inventory, increasing the merchandise inventory.

Under the Perpetual Inventory System,the Return of Goods from a Customer