Washington Warehouse is a small retail business that specializes in the sale of top-of-the-line televisions. This year, the store has begun to carry the Flat TV manufactured by Bass Co. Thus far this year, Washington has recorded the following transactions involving the Flat TV:
5 Jan Purchased 8 Flat TVs at a cost of $14,000
18 Jan Purchased 5 additional Flat TVs at $14,000 each
12 Feb Sold 9 Flat TVs to the Duke Hotel for $153,000

-Refer to the information above. If Washington uses a perpetual inventory system, the journal entry to record the sale on 12 February would include all of the following except:

Question

Washington Warehouse is a small retail business that specializes in the sale of top-of-the-line televisions. This year, the store has begun to carry the Flat TV manufactured by Bass Co. Thus far this year, Washington has recorded the following transactions involving the Flat TV:
5 Jan	 Purchased 8 Flat TVs at a cost of $14,000
18 Jan	 Purchased 5 additional Flat TVs at $14,000 each
12 Feb  Sold 9 Flat TVs to the Duke Hotel for $153,000

-Refer to the information above. If Washington uses a perpetual inventory system, the journal entry to record the sale on 12 February would include all of the following except:

Quizplus · Accepted Answer

Since Washington uses a perpetual inventory system, the cost of goods sold is recorded at the time of sale. Therefore, the journal entry would include a debit to the Cost of Goods Sold for the cost of goods sold, which is $153,000. It would also include a credit to Sales Revenue for the selling price of $182,000. Additionally, there would be a credit to Inventory for the cost of goods sold, which is $153,000. However, there would be no credit to Purchases since this account is used to record the cost of goods purchased during the accounting period, and not for recording the cost of goods sold.

Washington Warehouse Is a Small Retail Business That Specializes in the Sale