In a Perpetual Inventory System,two Entries Are Normally Made to Record

question 105

Multiple Choice

In a perpetual inventory system,two entries are normally made to record each sales transaction.The purpose of these entries is best described as follows:

• A)One entry recognizes the sales revenue and the other recognizes the cost of goods sold.
• B)One entry records the purchase of merchandise and the other records the sale.
• C)One entry records the cost of goods sold and the other reduces the balance in the Inventory account.
• D)One entry updates the subsidiary ledger and the other updates the general ledger.

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Definitions:

Diversity of Citizenship

A legal concept under civil procedure that allows a federal court to hear a lawsuit if the parties involved are from different U.S. states or a foreign country.

Federal Court

A court established by the national government that has jurisdiction over disputes involving federal laws, constitutional issues, or disputes between states or between a state and the federal government.

Exercise Jurisdiction

The act of applying or enforcing legal authority over a geographical area or group of people.

Appellate Court

A court that reviews the decisions of lower courts to ensure the law was applied correctly.