A company sold merchandise with a cost of​ $500 for​ $2,000 on account. The seller uses the perpetual inventory system. The entry to record the sale at the retail sales price is ​ ________.

Answer 1

In a perpetual inventory system, when a sale is made, two journal entries are typically required: one to record the sale and another to record the cost of goods sold.

1. To record the sale at the retail sales price:
   You would debit Accounts Receivable (or Cash if it was a cash sale) and credit Sales Revenue.

   Journal Entry:

   Debit: Accounts Receivable (or Cash)   $2,000
   Credit: Sales Revenue                   $2,000
   

Thus, the entry to record the sale at the retail sales price is to debit Accounts Receivable for $2,000 and credit Sales Revenue for $2,000.