Question 1

To verify that the sum of the accounts receivable ledger balances equals the Accounts Receivable balance, a schedule of accounts payable is prepared.

Accepted Answer

A) True 
 B)False

Question 2

If any merchandise has been returned, the sales discount is calculated on the net sales amount.

Accepted Answer

A) True 
 B)False

Question 3

Net sales less sales returns and allowances and sales discounts equal gross sales.

Accepted Answer

A) True 
 B)False

Question 4

Sales Tax Payable is a liability account.

Accepted Answer

A) True 
 B)False

Question 5

Match the terms with the definitions.
-Merchandise returned by a customer for a refund.

Accepted Answer

A) accounts receivable ledger 
B) cash discounts 
C) controlling account 
D) credit memo 
E) merchandising business
F)sale
G)sales allowances
H)sales discounts
I)sales invoice
J)sales return
K)sales ticket
L)schedule of accounts receivable 
A) accounts receivable ledger 
B) cash discounts 
C) controlling account 
D) credit memo 
E) merchandising business
F)sale
G)sales allowances
H)sales discounts
I)sales invoice
J)sales return
K)sales ticket
L)schedule of accounts receivable

Question 6

While sales returns and allowances can be debited directly to the sales account, it is better to debit a separate sales returns and allowances account.

Accepted Answer

A) True 
 B)False

Question 7

If the seller permits merchandise to be returned or an allowance to be made, it is customary for the seller to issue a(n)

Accepted Answer

A)  debit memorandum. 
B)  return memorandum. 
C)  credit memorandum. 
D)  allowance memorandum. 
A)  debit memorandum. 
B)  return memorandum. 
C)  credit memorandum. 
D)  allowance memorandum.

Question 8

If the amount of sales returns and allowances is large in proportion to gross sales, a weakness in the merchandising operations is indicated and the trouble should be determined and corrected.

Accepted Answer

A) True 
 B)False

Question 9

A credit memorandum for $156 (sales price of merchandise, $150; sales tax $6) was issued to a customer for goods returned that had been purchased on account. To enter this transaction properly,

Accepted Answer

A)  Accounts Receivable would be credited for $6. 
B)  Accounts Receivable would be credited for $150. 
C)  Accounts Receivable would be credited for $156. 
D)  Accounts Receivable would not be credited. 
A)  Accounts Receivable would be credited for $6. 
B)  Accounts Receivable would be credited for $150. 
C)  Accounts Receivable would be credited for $156. 
D)  Accounts Receivable would not be credited.

Question 10

A schedule of accounts receivable is prepared to

Accepted Answer

A)  verify that the sum of the accounts receivable ledger balances equals the Accounts Receivable balance. 
B)  send to all customers at the end of the month. 
C)  prove that the general ledger and accounts receivable ledger were posted at the same time. 
D)  keep track of all the company's customers. 
A)  verify that the sum of the accounts receivable ledger balances equals the Accounts Receivable balance. 
B)  send to all customers at the end of the month. 
C)  prove that the general ledger and accounts receivable ledger were posted at the same time. 
D)  keep track of all the company's customers.

Question 11

A customer returns merchandise that was delivered in poor condition and that does not meet specification. The account that the seller would debit for the amount of the return is

Accepted Answer

A)  Sales Returns and Allowances. 
B)  Purchase Returns and Allowances. 
C)  Sales. 
D)  Purchases. 
A)  Sales Returns and Allowances. 
B)  Purchase Returns and Allowances. 
C)  Sales. 
D)  Purchases.

Question 12

Reductions in the price of merchandise granted by the seller because of defects or other problems with the merchandise are called merchandise sales.

Accepted Answer

A) True 
 B)False

Question 13

After the posting of the accounts receivable ledger and the general ledger is completed, the total of the accounts receivable ledger balances should equal the Accounts Receivable balance in the general ledger.

Accepted Answer

A) True 
 B)False

Question 14

A common approach to keeping a record of each customer's account receivable is to use a subsidiary accounts receivable ledger.

Accepted Answer

A) True 
 B)False

Question 15

The account that would be credited for the amount of tax collected and paid on sales would be

Accepted Answer

A)  Sales. 
B)  Sales Tax Payable. 
C)  Cash. 
D)  Accounts Payable. 
A)  Sales. 
B)  Sales Tax Payable. 
C)  Cash. 
D)  Accounts Payable.

Question 16

To encourage customers who purchase merchandise on account to pay promptly, a cash discount is usually offered.

Accepted Answer

A) True 
 B)False

Question 17

The source document of a sales transaction is called a

Accepted Answer

A)  sales ticket. 
B)  sales return. 
C)  purchase order. 
D)  purchase receipt. 
A)  sales ticket. 
B)  sales return. 
C)  purchase order. 
D)  purchase receipt.

Question 18

Merchandise is sold on account for $90, and the sale is subject to a retail sales tax of $6.40. The amount that should be added to Accounts Receivable would be

Accepted Answer

A)  $6.40. 
B)  $94.60. 
C)  $83.60. 
D)  $96.40. 
A)  $6.40. 
B)  $94.60. 
C)  $83.60. 
D)  $96.40.

Question 19

Match the terms with the definitions.
-Purchases merchandise such as clothing, furniture, or computers, and sells that merchandise to its customers.

Accepted Answer

A) accounts receivable ledger 
B) cash discounts 
C) controlling account 
D) credit memo 
E) merchandising business
F)sale
G)sales allowances
H)sales discounts
I)sales invoice
J)sales return
K)sales ticket
L)schedule of accounts receivable 
A) accounts receivable ledger 
B) cash discounts 
C) controlling account 
D) credit memo 
E) merchandising business
F)sale
G)sales allowances
H)sales discounts
I)sales invoice
J)sales return
K)sales ticket
L)schedule of accounts receivable

Question 20

During the month of September, the following transactions occurred. The applicable sales tax rate is 6%. Enter the transactions in the general journal. Sept. 2 Sold merchandise on account to Sam Larson, $\$ 1,400$, plus sales tax.
7 Sold merchandise on account to David Mitchell, $\$ 1,900$, plus sales tax.
12 Issued credit memorandum to Sam Larson for $\$ 689$, including sales tax of $\$ 39$.
22 Sold merchandise on account to Matt Feustal, $\$ 500$, plus sal es tax.
28 Sold merchandise on account to Ana Cardona, $\$ 850$, plus sales tax. ​

Accepted Answer

The answer of During the month of September, the following...

Exam 10: Accounting for Sales and Cash Receipts

To verify that the sum of the accounts receivable ledger balances equals the Accounts Receivable balance, a schedule of accounts payable is prepared.

If any merchandise has been returned, the sales discount is calculated on the net sales amount.

Net sales less sales returns and allowances and sales discounts equal gross sales.

Sales Tax Payable is a liability account.

Match the terms with the definitions. -Merchandise returned by a customer for a refund.

While sales returns and allowances can be debited directly to the sales account, it is better to debit a separate sales returns and allowances account.

If the seller permits merchandise to be returned or an allowance to be made, it is customary for the seller to issue a(n)

If the amount of sales returns and allowances is large in proportion to gross sales, a weakness in the merchandising operations is indicated and the trouble should be determined and corrected.

A credit memorandum for $156 (sales price of merchandise, $150; sales tax $6) was issued to a customer for goods returned that had been purchased on account. To enter this transaction properly,

A schedule of accounts receivable is prepared to

A customer returns merchandise that was delivered in poor condition and that does not meet specification. The account that the seller would debit for the amount of the return is

Reductions in the price of merchandise granted by the seller because of defects or other problems with the merchandise are called merchandise sales.

After the posting of the accounts receivable ledger and the general ledger is completed, the total of the accounts receivable ledger balances should equal the Accounts Receivable balance in the general ledger.

A common approach to keeping a record of each customer's account receivable is to use a subsidiary accounts receivable ledger.

The account that would be credited for the amount of tax collected and paid on sales would be

To encourage customers who purchase merchandise on account to pay promptly, a cash discount is usually offered.

The source document of a sales transaction is called a

Merchandise is sold on account for $90, and the sale is subject to a retail sales tax of $6.40. The amount that should be added to Accounts Receivable would be

Match the terms with the definitions. -Purchases merchandise such as clothing, furniture, or computers, and sells that merchandise to its customers.

Introduction to Accounting

Analyzing Transactions: the Accounting Equation

The Double-Entry Framework

Journalizing and Posting Transactions

Adjusting Entries and the Work Sheet

Financial Statements and the Closing Process

Accounting for Cash

Payroll Accounting: Employee Earnings and Deductions

Payroll Accounting: Employer Taxes and Reports

Accounting for Purchases and Cash Payments

Special Journals

Accounting for Merchandise Inventory

Adjustments and the Work Sheet for a Merchandising Business

Financial Statements and Year-End Accounting for a Merchandising Business

Accounting for Accounts Receivable

Accounting for Notes and Interest

Accounting for Long-Term Assets

Accounting for Partnerships

Corporations: Organization and Capital Stocks

Corporations: Earnings, Taxes, Distributions, and the Retained Earnings Statement

Corporations: Bonds

Statement of Cash Flows

Analysis of Financial Statements

Departmental Accounting

Manufacturing Accounting: The Job Order Cost System

Manufacturing Accounting: The Work Sheet and Financial Statements

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