Q11. Sale of merchandise
Entity A sold merchandise at the price of $26,000 on account.
Prepare a journal entry to record this transaction.
A11. Sale of merchandise on account is recorded by posting accounts receivable on the debit side.
Journal entry:
| Debit | Credit | |
| Accounts receivable | 26,000 | |
| Sales revenue | 26,000 |
[Note]
1. Increase in accounts receivable (asset): debit
2. Increase in sales revenue (revenue): credit
[Exercise]
Entity B sold merchandise at the price of $25,000 and received $10,000 in cash. The remaining balance will be collected 30 days later.
| Debit | Credit | |
| Cash | 10,000 | |
| Accounts receivable | 15,000 | |
| Sales revenue | 25,000 |
[Note]
1. Increase in cash (asset): debit
2. Increase in accounts receivable (asset): debit
3. Increase in sales revenue (revenue): credit
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