Question

Under the periodic inventory​ system, which of the following entries is prepared at the end of the accounting​ period?

A. debit Purchases and credit Cost of Goods Sold
B. debit Cost of Goods Sold and credit Inventory
C. debit Cost of Goods Sold and credit Purchases
D. B and C

Answer 1

The correct option is C

Step-by-step explanation:

Under the periodic inventory system, the amount of the inventory is determined or evaluated at the end of the accounting year or period. And the journal entry which is to be recorded under this system is:

Merchandise Inventory A/c...................Dr XXXX

To Purchases A/c................................Cr XXXX

COGS (Cost of goods sold) A/c.................Dr XXXX

To Purchases A/c.........................................Cr XXXX