Question

Which of the following entries or sets of entries would record sales for the month of July of $200,000 for goods costing $119,000 for?

Multiple Choice

• A

  Accounts Receivable	200,000
  Sales		200,000

• B

  Accounts Receivable	200,000
  Sales		200,000
  Cost of Goods Sold	119,000
  Work in Process		119,000

• C

  Cost of Goods Sold	119,000
  Net Income	81,000
  Sales		200,000

• D

  Accounts Receivable	200,000
  Sales		200,000
  Cost of Goods Sold	119,000
  Finished Goods		119,000

Answer 1

Answer is option d)

Accounts Receivable	200,000
Sales		200,000
Cost of Goods Sold	119,000
Finished Goods		119,000

Two entries are made for sale under perpectual system

Sale is income. income to be credited when increasing $200000

Acount receivable is an asset. . Asset is to be debited when inceasing

Finished goods ( inventory) is an asset Asset is to be credited when decreasing

Cost of gooods sold is an expense . expense to be debited when increasing