Question

The sales price will appear as a .

1. Debit to the seller; credit to the broker
2. Debit to the broker; credit to the seller
3. Debit to the buyer; credit to the seller
4. Debit to the seller; credit to the buyer

Answer 1

The correct answer is option 2: Debit to the broker; credit to the seller.

Step-by-step explanation:

The correct answer to this question is option 2: Debit to the broker; credit to the seller.

When a sales transaction occurs, there are typically two parties involved: the seller and the buyer. The sales price represents the amount of money the buyer pays to acquire the goods or services. In this case, the transaction involves a broker as well. The seller records a debit entry to decrease their accounts receivable (since they are receiving payment), and the broker records a credit entry to increase their revenue (since they facilitated the sale).