Chapter 9

Question 1

A merchandising business that sells to those who use or consume the goods

Answer 1

Retail merchandising business

Question 2

A business that buys and resells merchandise to retail merchandising businesses

Answer 2

Wholesale merchandising business

Question 3

A transaction in which the merchandise purchased is to be paid for later

Answer 3

Purchase on account

Question 4

Total shares of ownership in a corporation

Answer 4

Capital stock

Question 5

An organization with the legal rights of a person and which many persons may own

Answer 5

Corporation

Question 6

A merchandising business that sells to those who use or consume the goods

Answer 6

Retail merchandising business

Question 7

Credit allowed for part of the purchase price of merchandise that is not returned, resulting in a decrease in customers accounts payable

Answer 7

Purchases allowance

Question 8

Goods that a business purchases to sell

Answer 8

Merchandise

Question 9

An account that reduces a related account on a financial statement

Answer 9

Contra account

Question 10

The retail price listed in a catalog or in Internet site

Answer 10

List price

Question 11

A business that purchases and sells goods

Answer 11

Merchandising business

Question 12

A petty cash on hand amount that is more than a recorded amount

Answer 12

Cash over

Question 13

A petty cash on hand amount that is less than a recorded amount

Answer 13

Cash short

Question 14

The amount added to the cost of merchandise to establish the selling price

Answer 14

Markup

Question 15

A deduction that vendor allows in the invoice amount to encourage prompt payment

Answer 15

Cash discount

Question 16

A special journal used to record only purchases or merchandising on account

Answer 16

Purchases journal

Question 17

An owner of one or more shares or a corporation

Answer 17

Stockholder

Question 18

A reduction in the list price granted to customers

Answer 18

Trade discount

Question 19

A journal amount column headed with an account title

Answer 19

Special amount column

Question 20

Total shares of ownership in corporation

Answer 20

Capital stock

Question 21

Credit allowed for the purchase price of returned merchandise, resulting in a decreased in the customers accounts payable

Answer 21

Purchases return

Question 22

Each unit of ownership in a corporation

Answer 22

Share of stock

Question 23

An agreement between buyer and a seller about payment for merchandise

Answer 23

Terms of sale

Question 24

A journal used to record only one kind of transaction

Answer 24

Special journal

Question 25

A special journal used to record only cash payment transactions

Answer 25

Cash payment journal

Question 26

An invoice used as a source document for recording a purchase on account transaction

Answer 26

Purchase invoice

Question 27

A jourMl amount column that is not headed with an account title

Answer 27

General amount column

Question 28

Each unit of ownership in corporation

Answer 28

Share of stock

Question 29

A business from which merchandise is purchase it supplies or other assets are bought.

Answer 29

Vendor

Question 30

Cash discount on purchases taken by a customer.

Answer 30

Purchases discount

Question 31

The price a business pays for goods it purchases to sell

Answer 31

Cost of merchandise

Question 32

A form prepared by the customer showing the price deduction taken by the customer for returns and allowances.

Answer 32

Debit memorandum