X Company is a merchandiser and prepares monthly financial statements. On Septem

Question

X Company is a merchandiser and prepares monthly financial statements. On September 6, its accountant made an entry that resulted in a $42,000 increase in the Cash account and a $42,000 decrease in the Accounts Receivable account. Which of the following transactions is consistent with this entry? X Company received $42,000 from a customer who bought merchandise with cash paid $42,000 to a supplier from whom the firm had previously bought merchandise on account. received $42,000 from a new investor borrowed $42,000 from a bank and signed a note received $42,000 from a customer who had previously bought merchandise on account. sold merchandise to customers on account for $42,000

Explanation / Answer

Journal entry :

so it means 42000 received from customer who previously purchased on account

so answer is e) received $42000 from a customer who had previously bought merchandise on account.

Date accounts & explanation debit credit Cash 42000 Account receivable 42000 (To record cash received from customer)

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