Chapter 14 Concept Assessment – Flashcards
Unlock all answers in this set
Unlock answersquestion
a cash discount issued by the seller is a ____________.
answer
cash discount
question
a _______ book that is summarized in a controlling account in the general ledger
answer
subsidiary ledger
question
an account whose balance decreases another account's balance is a _______.
answer
contra account
question
a credit card that is issued by a bank and honored by many businesses
answer
bankcard
question
a form that serves as a record of cash received
answer
receipt
question
a business that sells to the final user
answer
retailer
question
a transaction that occurs when a business receives full payment for the merchandise sold at the time of the sale
answer
cash sale
question
a form that lists the details of a sail and is used as a record of the transactions is a _________.
answer
sales slip
question
contains accounts of the charge customers of a business
answer
accounts receivable subsidiary
question
cash received by a business is referred to as a ______.
answer
cash receipt
question
goods a business buys for resale to customers
answer
merchandise
question
a customer to whom a sale on account is made
answer
charge customer
question
merchandise returned to the seller for full credit
answer
sales return
question
accounts receivable is a ________ because its balance must equal the total of the accounts receivable subsidiary ledger
answer
controlling account
question
many states and some cities require that a business add a _______, as a percentage of the selling price of the goods, at the time of the sale
answer
sales tax
question
the ______ of a sale state the time allowed for payment for sale on account
answer
credit terms
question
a business that sells to retailers
answer
wholesaler
question
a charger customer is entitled to to charge merchandise with a ________.
answer
credit card
question
the items of merchandise a business has in stock are referred to as ________
answer
inventory
question
permits a customer to pay for the merchandise at a later date
answer
sales on account
question
an example of a _______ is Wal-Mart
answer
merchandising business
question
a document prepared by the seller granting credit for damaged or returned merchandise
answer
credit memorandum
question
a price reduction granted by a business for damaged goods kept by the customer is called a _________
answer
sales allowance
question
the revenue account for a merchandising business is ________
answer
sales
question
the amount a customer may deduct if the payment for merchandise is made within a certain time is a __________
answer
sales discount
question
retailers include clothing stores, cd and tape shops, and automobile dealerships
answer
true
question
the account merchandise inventory is classified in the chart of accounts as an asset
answer
true
question
a sale on account is paid for in cash when the merchandise is sold
answer
false
question
a sales slip is usually prepared in multiple copies with the customer receiving the original and the business keeping the remaining copies
answer
true
question
Sales taxes are not usually charged to government agencies
answer
True
question
In a merchandising business, the most frequent type of transaction is the sale of merchandise
answer
True
question
Electrical supply companies, auto parts distributors, and food supply companies are examples of wholesalers
answer
True
question
Two of the accounts used by merchandising businesses are merchandise inventory and professional fees
answer
False
question
The cash register tape is the source document for the journal entry to record the day's cash sales
answer
True
question
Sales discounts is classified as a contra revenue account
answer
True
question
A sales discount increases the revenue account sales
answer
False
question
When a cash sale occurs, the details of the sale are printed on two tapes in the cash register at the same time
answer
True
question
A cash discount is recorded at the time the sale is made
answer
False
question
Bank card sales are processed the same way as the store's regular charge card sales
answer
False
question
A cash discount is calculated on the total of a sales slip, including the sales tax
answer
False
question
The most widely used bank card in North America is American express
answer
False
question
A proof is usually prepared at the end of each day to show that the amount of cash in the cash register equals the amount of cash sales recorded on the cash register tape
answer
True
question
A cash discount is an advantage only to the buyer because he or she is able to purchase the merchandise at a reduced cost
answer
False
question
The normal balance side of the merchandise inventory account is a
answer
debit
question
The normal balance side of the sales tax payable account is a
answer
credit
question
the normal balance side of the sales discounts account is a
answer
debit
question
the normal balance side of the sales account is a
answer
credit
question
the increase side of the sales tax payable account is a
answer
credit
question
the decrease side of the sales discounts account is a
answer
credit
question
the decrease side of the sales tax payable account is a
answer
debit
question
the decrease side of the sales account is a
answer
debit
question
the decrease side of the merchandise inventory account is a
answer
credit
question
the increase side of the sales discounts account is a
answer
debit
question
the increase side of the sales account is a
answer
credit
question
the increase side of the merchandise inventory account is a
answer
debit
