Davis Hardware Company uses a perpetual inventory system. How should Davis record the sale of merchandise, costing $810, and sold on account for $1,340?

Multiple Choice

• Inventory	810
  Accounts receivable		810
  Sales	1,340
  Revenue from sales		1,340

• Accounts receivable	1,340
  Sales revenue		1,340
  Cost of goods sold	810
  Inventory		810

• Inventory	810
  Gain on sale	530
  Sales revenue		1,340

• Accounts receivable	1,340
  Sales revenue		810
  Gain on sale		530