VLC Corporation sold merchandise with a cost of $200 on account for $300 to PRT Corporation; credit terms were 2 / 10, n / 30. VLC paid the outgoing freight charge of $10. PRT paid the invoice within the discount period. The entries in VLC's accounting information system to record all the preceding events will include all of the following except:

A. A debit to cost of goods sold

B. A debit to delivery expense

C. A credit togross profit

D. A credit to inventory

Question

Business

Tyler Mckee

16 April, 04:59

VLC Corporation sold merchandise with a cost of $200 on account for $300 to PRT Corporation; credit terms were 2 / 10, n / 30. VLC paid the outgoing freight charge of $10. PRT paid the invoice within the discount period. The entries in VLC's accounting information system to record all the preceding events will include all of the following except:

A. A debit to cost of goods sold

B. A debit to delivery expense

C. A credit togross profit

D. A credit to inventory

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Answers (1)

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London · Answer 1

The entries in VLC's accounting information system to record all the preceding events will include all of the following except:

C. A credit togross profit

Explanation:

An entry to Gross Profit does not exist because the gross profit it's the result of the total sales minus the Cost of Goods, so the Gross Profit it's a result and not a journal entry.

The other entries are used as follows:

A. A debit to cost of goods sold

D. A credit to inventory

B. A debit to delivery expense

A credit to Cash