When recording the sale of kitchen products in a journal entry, which accounts are typically debited and credited to reflect the total quantity sold?

• A. Debit Sales Revenue; Credit Inventory
• B. Debit Cash; Credit Cost of Goods Sold
• C. Debit Inventory; Credit Cash
• D. Debit Accounts Receivable; Credit Sales Revenue

Answer: (D)

Verified step by step guidance

1. Step 1: Understand the nature of the transaction. The sale of kitchen products involves recognizing revenue and recording the payment method (e.g., cash or accounts receivable). Additionally, the cost associated with the sold inventory must be accounted for.
2. Step 2: Identify the accounts involved. For this transaction, the accounts typically include 'Accounts Receivable' (if the sale is on credit), 'Sales Revenue' (to record the income from the sale), 'Inventory' (to reduce the stock sold), and 'Cost of Goods Sold' (to record the expense related to the sold inventory).
3. Step 3: Determine the journal entry for recognizing revenue. Debit 'Accounts Receivable' to reflect the amount owed by the customer, and credit 'Sales Revenue' to record the income earned from the sale.
4. Step 4: Record the cost of goods sold. Debit 'Cost of Goods Sold' to reflect the expense incurred for the sold inventory, and credit 'Inventory' to reduce the stock of goods sold.
5. Step 5: Ensure the journal entry balances. Verify that the total debits equal the total credits in the journal entry to maintain the accounting equation: Assets = Liabilities + Equity.