South Meadows, Inc. sold 500 units of inventory at $25 per u

South Meadows, Inc. sold 500 units of inventory at $25 per unit on account. The company uses the perpetual inventory system. The cost of the units sold was $10 per unit. Provide the journal entries to record the sale.

What will be an ideal response

ANSWER

Accounts Receivable 12,500
Sales Revenue 12,500

Cost of Goods Sold 5,000
Merchandise Inventory 5,000

Note:
Sales Revenue = 500 units × $25 per unit = $12,500