Saturn Corporation sold inventory costing $32,000 for $45,000 cash. Which of the following statements is true of this transaction?
a. Saturn will record a gain on sale of $13,000
b. inventory decreases by $45,000
c. cost of goods sold increases by $32,000
d. cash increases by $32,000
e. sale of merchandise increases by $32,000
Answer: c. cost of goods sold increases by $32,000
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