Question

Mullis company sold merchandise on account to a customer for $625, terms n/30. the journal entry to record the collection on account would be:

Answer 1

Since the transaction was on account basis, the journal entry will be:

debit accounts receivable for $625
credit sales $625

the account title accounts receivable was used because the debtor didn't pay for the merchandise and the sales account was used because the company gain income from that transaction.