Chapter 14-17 Flashcards
A merchandising business produces revenue through a series of transactions called the…
Operating cycle
Sale recorded on account, what is Debit?
Debit Accounts receivable
At the beginning of the accounting period,The dollar amount of merchandise in stock is indicated by..
A debit in the merchandise inventory
Goods bought for resale
Merchandise
Items of merchandise a business has in stock
Inventory
Normal balance of sales account is
Credit
A business that sells to the consumer is a..
Retailer
The time allowed for payment to be made on a credit sale is called its
Term
Journal entry for a cash refund is…
Debit sales return and allowances, credit cash in bank
Sales tax is recorded as a
Credit to sales tax expense
The form that lists the details of a sale is called
A sales slip
A price reduction granted for damaged good kept by the customer is called a
Sales allowance
Charge customers balances are recorded in a ledger called
Accounts receivable
A book that contains detailed data summarized to a controlling accounting in the general ledger is called a
Subsidiary ledger
To make a purchase, charge customers may use…
A credit card
Any merchandise returned for credit or a cash refund is called a…
Sales return
The sale of merchandise that will be paid for at a later date is called a
Sale on account
A transaction in which money comes in to a business is referred to as a
Cash receipt
A levy imposed by most states on the retail sales price of goods and services is a
Sales tax
When a customer pays on account, the accounts affected are
Cash in bank and accounts receivable
Visa, MasterCard, and discover are known as
Bank cards
When a business receives full payment for the merchandise at the time of the sale, it is called a
Cash sale
If a company sold for cash a file cabinet it was no longer using the accounts affected would be
Cash and office furniture
The accounts affected in a bank card sale are
Cash, sales and sales tax payable
The amount a customer can deficit from the amount owned for purchased merchandise if payment is made within a specified time is called a
Sales discount
A merchandise discount is calculated by
Multiplying the amount of the sale by the discount rate
An offer to charge customers to reduce their sale for early payment is called a
Purchases discount
The account used to record the cost of merchandise purchased during the fiscal period is the
Purchases account
A written request that a certain item be purchased is called a
Purchase requisition
The journal entry for recording purchases of merchandise for cash is
Debit purchases
Credit cash
A written offer to a supplier to buy certain items is called a
Purchase order
A form that liars the items included in shipment is called a
Packing slip
Information placed on a invoice that outlines a set of steps to be followed in preparing the invoice for payment is
A processing stamp
A discount on merchandise purchased is calculated by
Multiplying the purchase amount by the discount rate
To record a purchase return the accounting affected would be
Account payable, accounts payable subsidiary, purchase returns and allowances
The journal entry for the purchase of merchandise on account is
Debit purchases
Credit accounts payable
A notice to suppliers of a return or to request an allowance is called
A debit memorandum
When a business keeps less than satisfactory merchandise and pays a reduced price it is called a
Purchase allowance
The date an invoice is to be paid is called its
Due date
The purchase of insurance is recorded in
Prepaid insurance
Bank card fee is
An expense account
When the supplier pays the shipping cost to the buyers destination or location it is called
FOB destination
To record the cash payment of a shipping charge, the journal entry is
Debit transportation in
Credit cash
The cost of insurance protection is called
A premium
If a charge customer owes $1000 and is given a 2% cash discount of $20, the amount to be recorded in the accounts receivable credit column of the cash receipts journal is
$1000
The amount of cash actually received in a transaction is recorded on the cash receipts journal in the
Cash in bank debit column
For each line of the cash receipts journal
The debit and credit entries should be equal
When recording cash receipts, accounts for which there is no special column are recorded in the
General credit column
Every transaction recorded in the cash receipts journal requires a
Debit to the cash in bank account
Entries to the general debit column are posted
Daily
Each transaction in the cash payments journal affects
Cash in bank
