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A company sells goods to a customer who will pay the full amount in 30 days.How should the company record the sale

User Lymp
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1 Answer

3 votes

Answer:

Credit sales

Debit receivables

Step-by-step explanation:

This is a sales on account transaction which affect the sales and receivables account.

When this transaction occurs , the company has definitely made a sale which will lead to an inflow of cash in 30 days time, even though the income is recognized immediately according to the accrual method of accounting

To record this , the sales account is credited with the value of the goods sold and the account receivable is debited for with the same amount.

The receivable is a record of payment being owed to the company by its customers.

User Aldr
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