Sold merchandise on account would be recorded with:

A) a debit to an asset account.
B) a debit to a liability account.
C) a debit to Capital.
D) None of these is correct.

Question

Sold merchandise on account would be recorded with:A)  a debit to an asset account.B)  a debit to a liability account.C)  a debit to Capital.D)  None of these is correct.

saahas choudhary · Accepted Answer

Final Answer : A, Explanation :  When merchandise is sold on account, it means a sale has been made but payment has not yet been received, thus increasing the company's accounts receivable, an asset account. Therefore, a debit to an asset account (accounts receivable) reflects the increase in assets due to the sale.

Sold merchandise on account would be recorded with:

A) a debit to an asset account.
B) a debit to a liability account.
C) a debit to Capital.
D) None of these is correct.

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