13

A company that uses the perpetual inventory system purchased 500 pallets of industrial soap for $10,000 and paid $750 for the freight-in. The company sold the whole lot to a supermarket chain for $14,000 on account. The company uses the specific-identification method of inventory costing. Which of the following entries correctly records the cost of goods sold?

Cost of Goods Sold 10,750 Merchandise Inventory 10,750

MerchandiseInventory 10,750 Cost of Goods Sold 10,750

Cost of Goods Sold 10,000 Sales Revenue 10,000

Cost of Goods Sold 10,000 Merchandise Inventory 10,000