Question

17. Andy Store sold merchandise in the amount of $5,800 to a customer on October 1, with credit terms of 2/10, n/30. The cost of the items sold is $4,000. Andy uses the perpetual inventory system. The journal entries that Andy will make on October 1 will include: A) Debit to Accounts Receivable for $4,000 B) Credit to Merchandise Inventory for $5,800 C) Debit to Cost of Goods Sold for $5,800 D) Credit to Merchandise Inventory for $4,000 E) Credit to Net Income for $1,800

Answer 1

D) Credit to Merchandise Inventory for $4,000

Step-by-step explanation:

Date Account and Explanation Debit ($) Credit ($)

Account Receivable 5,800

Sale 5,800

(Recorded the sale on credit)

Cost of goods sold 4,000

Merchandise Inventory 4,000

(Recorded the cost of goods sold)