During a transaction, which account is typically credited when a good is sold?

When a good is sold, the Sales Income account is credited, reflecting the revenue generated from that sale. This is in accordance with accounting principles where revenue recognition occurs at the point of sale, matching the revenue earned to the period in which the transaction occurs. Crediting the Sales Income account increases the total sales revenue reported on the income statement, thus indicating that the business has successfully generated income from its operations.

While other accounts could be involved in the overall transaction — such as Accounts Receivable if the sale is made on credit, Cash if the sale is made in cash, or Inventory Asset if there is a corresponding decrease in inventory — the primary account that captures the revenue from sales is Sales Income. This clear distinction emphasizes the flow of income into the business, allowing for accurate reporting of financial performance.