Explanation:
The journal entry is as follows
In the books of Crane company
Merchandise Inventory A/c $1,350
To Accounts payable A/c $1,350
(Being inventory purchased on credit)
In the books of Sheridan Company
Account receivable A/c Dr $1,350
To Sales revenue $1,350
(Being the goods are sold on credit)
Cost of goods sold A/c Dr $655
To Merchandise Inventory A/c $655
(Being goods are sold at cost)
