In a perpetual system,when inventory is sold on account:
A)Sales Revenue is increased and Accounts Receivable is decreased.
B)Sales Revenue,Cost of Goods Sold,and Accounts Receivable are increased while Inventory is decreased.
C)Sales Revenue and Accounts Receivable are increased,and Cost of Goods Sold and Inventory are decreased.
D)Sales Revenue is increased and Inventory is decreased.

Question

Quizplus · Accepted Answer

When a company makes a sale on account under the perpetual system,it will increase Accounts Receivable,an asset account,and increase Sales Revenue,a revenue account.In addition,because a perpetual inventory system updates these accounts,it will increase Cost of Goods Sold,an expense account,and decrease Inventory,an asset account.

In a Perpetual System,when Inventory Is Sold on Account