Questions: 16 of 29 Concepts completed Multiple Select Question Select all that apply X-Mart uses the perpetual inventory system to account for its merchandise. On June 1, it sold 7,000 of merchandise for cash. The original cost of the merchandise to X-Mart was 500. Demonstrate the required journal entry to record the cost of the sale by selecting ofl of the correct actions below. Credit Cost of Goods Sold 500. Debit Cost of Goods Sold 500 Credit Merchandise Inventory 500. Debit Merchandise Inventory 500.

Solution Steps

To record the cost of the sale in a perpetual inventory system, we need to make two journal entries: one to record the revenue from the sale and another to record the cost of goods sold and the reduction in inventory. Since the question specifically asks for the journal entry to record the cost of the sale, we will focus on that part.

1. Debit the Cost of Goods Sold account to reflect the expense incurred.
2. Credit the Merchandise Inventory account to reduce the inventory by the cost of the sold merchandise.

To record the cost of the sale in a perpetual inventory system, we need to make two journal entries: one to record the revenue from the sale and another to record the cost of goods sold and the reduction in inventory. Since the question specifically asks for the journal entry to record the cost of the sale, we will focus on that part.

1. Debit the Cost of Goods Sold account to reflect the expense incurred.
2. Credit the Merchandise Inventory account to reduce the inventory by the cost of the sold merchandise.

Based on the given information:

• The cost of the merchandise sold is \(\$500\).

The journal entry to record the cost of the sale is:

• Debit Cost of Goods Sold \(\$500\)
• Credit Merchandise Inventory \(\$500\)

Final Answer