Question

Which of the following accounts are used when recording the sales entry of a sale on credit? A. merchandise inventory, cash B. accounts receivable, merchandise inventory C. accounts receivable, sales D. sales, cost of goods sold

Name: Problem 13, Chapter 6: Principles of Accounting Volume 1: Financial Accounting
Uploaded: 2020-05-16T10:05:51-08:00
Duration: 4 min 34 s
Channel: Puneet Prajapati
Description: Which of the following accounts are used when recording the sales entry of a sale on credit? A. merchandise inventory, cash B. accounts receivable, merchandise inventory C. accounts receivable, sales D. sales, cost of goods sold

   Which of the following accounts are used when recording the sales entry of a sale on credit?
A. merchandise inventory, cash
B. accounts receivable, merchandise inventory
C. accounts receivable, sales
D. sales, cost of goods sold

Principles of Accounting Volume 1: Financial Accounting

Mitchell Franklin,… 1st Edition

Chapter 6, Problem 13

Instant Answer

Solved by Expert Puneet Prajapati

05/16/2020

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A sale on credit refers to a transaction involving the exchange of goods or services where the payment will be made at a later date or in due time. Show more…

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Which of the following accounts are used when recording the sales entry of a sale on credit? A. merchandise inventory, cash B. accounts receivable, merchandise inventory C. accounts receivable, sales D. sales, cost of goods sold

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Key Concepts

Sales Revenue

Sales revenue is an income account that records the earnings from selling goods or services. When a sale on credit occurs, this account is credited to recognize the revenue, even though the cash has not yet been received.

Double-Entry Bookkeeping

Double-entry bookkeeping is an accounting system that requires every transaction to be recorded in at least two accounts, ensuring that debits and credits are balanced. In a credit sales transaction, one account (accounts receivable) is debited while another (sales revenue) is credited, maintaining the accounting equation.

Accounts Receivable

Accounts receivable is an asset account that tracks amounts owed by customers who purchase goods or services on credit. It increases when a sale on credit is made and reflects the future cash inflow from the customer.

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