Chapter 24 Review – Flashcards
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(D) debit Cash; credit Time Drafts Receivable.
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The entry to journalize the receipt of cash for the value of a time draft would be (A) debit Time Drafts Receivable; credit Cash. (B) debit Time Drafts Receivable; credit Sales. (C) debit Sales; credit Time Drafts Receivable. (D) debit Cash; credit Time Drafts Receivable.
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(C) Sales.
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The entry to journalize an international cash sale is a debit to Cash and a credit to (A) Accounts Receivable. (B) Time Drafts Receivable. (C) Sales. (D) Internet Sales.
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(B) cash receipts journal.
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The entry to journalize an international cash sale would be recorded in a (A) cash payments journal. (B) cash receipts journal. (C) general journal. (D) purchases journal.
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Exports
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Goods or services shipped out of a seller's home country to a foreign country.
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Letter of credit
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A letter issued by a bank guaranteeing that a named individual or business will be paid a specified amount provided stated conditions are met.
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Sight draft
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A draft payable on sight when the holder presents it for payment.
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Trade acceptance
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A form signed by a buyer at the time of a sale of merchandise in which the buyer promises to pay the seller a specified sum of money, usually at a stated time in the future.
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Imports
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Goods or services shipped into the buyer's home country from another country.
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Contract of sale
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A document that details all the terms agreed to by the seller and buyer for a sales transaction.
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Commercial invoice
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A statement prepared by the seller of merchandise addressed to the buyer, showing a detailed listing and description of merchandise sold, including prices and terms.
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Draft
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A written, signed, and dated order from one party ordering another party, usually a bank, to pay money to a third party.
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Time draft
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A draft that is payable at a fixed or determinable future time after it is accepted.
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Bill of lading
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A receipt signed by the authorized agent of a transportation company for merchandise received that also serves as a contract for the delivery of the merchandise.
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False
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Credit card sales on the Internet are handled differently than other credit card sales.
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False
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International transactions are all covered by the same universal commercial laws and the same accounting standards.
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True
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A company's website must be easy to navigate and safe to use.
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False
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It is easy to determine an international customer's financial condition or to take legal action if that customer does not pay.
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True
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Domestic sales are much simpler than international sales.
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True
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Selling merchandise to individuals or other businesses within one's own country is generally referred to as domestic sales.
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False
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The growth of information technology and trading relationships have made doing business internationally more complex.
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False
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Internet sales must be done in cash rather than by using a credit card.
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True
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International sales often specify a letter of credit as the method of payment.
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False
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International sales are not a very important source of revenue for businesses throughout the world.
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