What event and inventory method may have produced the following journal entry?

Question

Quizplus · Accepted Answer

The journal entry is likely a return of goods by a customer under the perpetual inventory method, which would result in a debit to merchandise inventory and a credit to cost of goods sold. This is because the perpetual inventory method allows for real-time tracking of inventory levels and cost of goods sold, whereas the periodic method only updates this information periodically (e.g. at the end of each accounting period).

What Event and Inventory Method May Have Produced the Following