A Company Sold Merchandise with a Cost of $238 for $440

question 190

Multiple Choice

A company sold merchandise with a cost of $238 for $440 on account.The seller uses the perpetual inventory system.The entry to record the cost of merchandise sold would include ________.

• A)a debit to Sales Revenue and a credit to Cash for $440
• B)a debit to Cash and a credit to Sales Revenue for $440
• C)a debit to Cost of Goods Sold and a credit to Merchandise Inventory for $238
• D)a debit to Merchandise Inventory for $238 and a credit to Cost of Goods Sold for $238

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Definitions:

Present Value

The contemporary value of a future financial amount or series of cash movements, given a pre-specified rate of return.

Interest Rate

The percentage at which interest is charged or paid for the use of money, often expressed annually.

Investment Options

Various financial assets or vehicles in which individuals or entities can invest money with the expectation of achieving a return.

Rule Of 70

A rule estimating the number of years required to double an investment or population at a particular annual growth rate, calculated by dividing 70 by that growth rate.