19. What does COGS stand for, and what type of account is it? __________________

Question

19. What does COGS stand for, and what type of account is it? _________________________________ _________________________________________________________________________________

20. Tiana, Inc. purchased inventory for $100,000 on account and recorded it as follows: Merchandise Inventory 100,000 Accounts Payable 100,000 The vendor, David, LLC, issued an invoice showing terms of 1/10, net 30. Give the journal entry for Tiana, Inc.’s payment of the invoice seven days after the invoice date, assuming David, LLC uses the perpetual inventory system. No description or date is needed.

Explanation / Answer

19 COGS Stands for Cost of Goods sold it is a expense so Nominal account 20 Merchandise Inventory              1,00,000    Accounts Payable                1,00,000 Accounts Payable              1,00,000    Discount Received *                      1,000    Cash                    99,000 * Discount 1/10 ,30 ---- payment made in 7 days so 1% Discount 100000*1% =1000

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