Respuesta :
Answer:
Debit Inventory $38,000
Credit Accounts Payable $38,000
Being entries to record inventory purchased on account.
Debit Cost of goods sold $38,000
Credit Inventory $38,000
Being entries to account for cost of items sold.
Debit Accounts receivable $58,000
Credit Revenue account $58,000
Being entries to recognize the sale of inventories.
Explanation:
When inventory is purchased on account, it means that cash was yet to be paid for the purchase and as such a liability should be recorded.
The entries required for the purchase of inventory would therefore be
Debit Inventory $38,000
Credit Accounts Payable $38,000
Being entries to record inventory purchased on account.
When the items are sold on account, it means cash was not collected at the point of sale. This creates another asset called accounts receivable. Entries required on sale
Debit Cost of goods sold $38,000
Credit Inventory $38,000
Being entries to account for cost of items sold
Then
Debit Accounts receivable $58,000
Credit Revenue account $58,000
Being entries to recognize the sale of inventories.
