Answer the following statements true (T) or false (F)
1. The Cost of Goods Sold account is deducted from Inventory when calculating net income or loss on the income statement.
2. Debit card and credit card sales are counted as cash transactions.
3. A journal entry that has more than one debit or more than one credit is known as a complex journal entry.
4. A company that expects customers to take advantage of offered sales discounts will most likely use the "net" method to record sales.
5. Leo Co. sold $300 of merchandise on account with terms of 2/10, n/30. Using the "net" method to record the sale, the journal entry would include a credit to revenue for $294.
1. FALSE
2. TRUE
3. FALSE
4. TRUE
5. TRUE
Explanation: sale amount × .98; $300 × .98 = $294
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