Question

Maxie's Game World sold games to a customer on credit for $2,600, terms 1/10, n/30 and the cost of the games was $1,700. When recording the sales transaction in its sales journal, Maxie's would enter: Multiple Choice $1,700 in the Accounts Receivable Dr./Sales Cr. column and $2,600 in the Cost of Goods Sold Dr./Inventory Cr. column. $2,600 in the Accounts Receivable Dr./Sales Cr. column and $1,700 in the Accounts Payable Dr./Purchases Cr. column. $2,600 in the Accounts Receivable Dr./Sales Cr. column and $2,600 in the Cash Cr. column. $2,600 in the Accounts Receivable Dr./Sales Cr. column and $1,700 in the Cost of Goods Sold Dr./Inventory Cr. column. $1,700 in the Accounts Receivable Dr./Sales Cr. column and $2,600 in the Other Accounts Dr. column.

Answer 1

Answer:

$2,600 in the Accounts Receivable Dr./Sales Cr. column and $1,700 in the Cost of Goods Sold Dr./Inventory Cr. column.

Explanation:

If we assume that Maxie's Game World uses a perpetual inventory system, the appropriate journal entries should be:

Date XXX, merchandise sold on credit to client YYY, terms 1/10, n/30

Dr Accounts receivable 2,600

    Cr Sales revenue 2,600

Dr Cost of goods sold 1,700

    Cr Merchandise inventory 1,700