Question 1

The normal balance of the Sales Returns and Allowances account is:

Accepted Answer

A)  a credit. 
B)  a debit. 
C)  zero. 
D)  It does not have a normal balance. 
A)  a credit. 
B)  a debit. 
C)  zero. 
D)  It does not have a normal balance.

Question 2

Gross sales equals:

Accepted Answer

A)  net sales minus sales discount. 
B)  sales discount less net income. 
C)  the total of cash sales and credit sales. 
D)  supplies minus inventory. 
A)  net sales minus sales discount. 
B)  sales discount less net income. 
C)  the total of cash sales and credit sales. 
D)  supplies minus inventory.

Question 3

Prepare the necessary general journal entry for December 16.
__________________________________________ __________ __________
__________________________________________ __________ __________
__________________________________________ __________ __________

Accepted Answer

The answer of Prepare the necessary general journal entry for...

Question 4

Sales Returns and Allowances is a contra-revenue account with a normal debit balance.

Accepted Answer

A) True 
 B)False

Question 5

Sold merchandise on account would be recorded with:

Accepted Answer

A)  a debit to an asset account. 
B)  a debit to a liability account. 
C)  a debit to Capital. 
D)  None of these is correct. 
A)  a debit to an asset account. 
B)  a debit to a liability account. 
C)  a debit to Capital. 
D)  None of these is correct.

Question 6

A characteristic of a schedule of accounts receivable is that:

Accepted Answer

A)  it contains a list of customers' names with balances. 
B)  the total is equal to the accounts receivable control account at the end of the month. 
C)  it is prepared at the end of the month. 
D)  All of these answers are correct. 
A)  it contains a list of customers' names with balances. 
B)  the total is equal to the accounts receivable control account at the end of the month. 
C)  it is prepared at the end of the month. 
D)  All of these answers are correct.

Question 7

H.R. Camping sold goods for $200 to a charge customer. The customer returned for credit $100 worth of goods. Which entry is required to record the return transaction?

Accepted Answer

A)  Debit Sales Returns and Allowances $100 credit Accounts Receivable $100 
B)  Debit Sales Returns and Allowances $100; credit Sales $100 
C)  Debit Sales $100; credit Sales Returns and Allowances $100 
D)  Debit Accounts Receivable $100; credit Sales Returns and Allowances $100 
A)  Debit Sales Returns and Allowances $100 credit Accounts Receivable $100 
B)  Debit Sales Returns and Allowances $100; credit Sales $100 
C)  Debit Sales $100; credit Sales Returns and Allowances $100 
D)  Debit Accounts Receivable $100; credit Sales Returns and Allowances $100

Question 8

Credit terms of 3/15, n/30 mean that:

Accepted Answer

A)  a 3% discount is allowed if the bill is paid within between 15 and 30 days. 
B)  a 3% discount is allowed if the bill is paid within 30 days. 
C)  a 3% discount is allowed if the bill is paid before the 15th day of the following month. 
D)  a 3% discount is allowed if the customer pays the bill within 15 days, or the entry amount is due within 30 days. 
A)  a 3% discount is allowed if the bill is paid within between 15 and 30 days. 
B)  a 3% discount is allowed if the bill is paid within 30 days. 
C)  a 3% discount is allowed if the bill is paid before the 15th day of the following month. 
D)  a 3% discount is allowed if the customer pays the bill within 15 days, or the entry amount is due within 30 days.

Question 9

Accounts in the accounts receivable subsidiary ledger are listed alphabetically.

Accepted Answer

A) True 
 B)False

Question 10

Merchandise is:

Accepted Answer

A)  the same as inventory. 
B)  an asset. 
C)  the same as supplies. 
D)  Both A and B are correct. 
A)  the same as inventory. 
B)  an asset. 
C)  the same as supplies. 
D)  Both A and B are correct.

Question 11

When a customer returns defective office supplies, the Sales Returns and Allowances account will be debited.

Accepted Answer

A) True 
 B)False

Question 12

For each of the following, identify in column 1 the category to which the account belongs, in column 2 the normal balance for the account, and in column 3 the financial statement on which the account balance is reported.
-

Accepted Answer

The answer of For each of the following, identify in...

Question 13

Prepare the necessary general journal entry for December 10.
__________________________________________ __________ __________
__________________________________________ __________ __________
__________________________________________ __________ __________

Accepted Answer

The answer of Prepare the necessary general journal entry for...

Question 14

The accounts receivable subsidiary ledger:

Accepted Answer

A)  is organized in alphabetical order. 
B)  is not kept in the same book as Accounts Receivable. 
C)  should equal the controlling account in the general ledger. 
D)  All of the above are correct. 
A)  is organized in alphabetical order. 
B)  is not kept in the same book as Accounts Receivable. 
C)  should equal the controlling account in the general ledger. 
D)  All of the above are correct.

Question 15

The contra-revenue accounts include:

Accepted Answer

A)  Sales Tax Payable. 
B)  Sales Returns and Allowances. 
C)  Sales Discount. 
D)  Both B and C are correct. 
A)  Sales Tax Payable. 
B)  Sales Returns and Allowances. 
C)  Sales Discount. 
D)  Both B and C are correct.

Question 16

The accounts receivable subsidiary ledger shows the amount collected from each customer.

Accepted Answer

A) True 
 B)False

Question 17

Santa Materials sold goods for $3,200 plus 5% sales tax to a charge customer, terms n/30. Which entry is required to record this transaction?

Accepted Answer

A)  Debit Accounts Receivable $3,360; credit Sales Tax Payable $160; credit Sales $3,200 
B)  Debit Cash $3,200; credit Sales $3,200 
C)  Debit Accounts Receivable $3,200; credit Sales $3,200 
D)  Debit Accounts Receivable $3,360; credit Sales $3,360 
A)  Debit Accounts Receivable $3,360; credit Sales Tax Payable $160; credit Sales $3,200 
B)  Debit Cash $3,200; credit Sales $3,200 
C)  Debit Accounts Receivable $3,200; credit Sales $3,200 
D)  Debit Accounts Receivable $3,360; credit Sales $3,360

Question 18

The discount period is longer than the credit period.

Accepted Answer

A) True 
 B)False

Question 19

Mel's Art studio was moving and sold furniture that was no longer needed for cash. The entry would include:

Accepted Answer

A)  a credit to Sales. 
B)  a debit to Sales. 
C)  a credit to Furniture. 
D)  a credit to Cash. 
A)  a credit to Sales. 
B)  a debit to Sales. 
C)  a credit to Furniture. 
D)  a credit to Cash.

Question 20

The Milk Co. had the following transactions involving the sale of merchandise. You are to prepare the necessary general journal entries. All sales are subject to a 6% sales tax. Terms of sale were n/30.
April 13 Sold merchandise priced at $600 to James Ellsworth on account.
April 14 Sold merchandise priced at $325 to a cash customer.
April 15 Sold merchandise priced at $175 to Dana Carter on account.
April 16 Sold merchandise priced at $700 to a cash customer.
April 20 The customer of April 14 returned $50 worth of merchandise for a cash refund.
April 25 Received full payment from Dana Carter.
April 30 Paid the amount of sales tax to the state.
-Prepare the necessary general journal entry for April 20.
__________________________________________ __________ __________
__________________________________________ __________ __________
__________________________________________ __________ __________

Accepted Answer

The answer of The Milk Co. had the following transactions...

Exam 9: Sales and Cash Receipts

The normal balance of the Sales Returns and Allowances account is:

Gross sales equals:

Prepare the necessary general journal entry for December 16. __________________________________________ __________ __________ __________________________________________ __________ __________ __________________________________________ __________ __________

Sales Returns and Allowances is a contra-revenue account with a normal debit balance.

Sold merchandise on account would be recorded with:

A characteristic of a schedule of accounts receivable is that:

H.R. Camping sold goods for $200 to a charge customer. The customer returned for credit $100 worth of goods. Which entry is required to record the return transaction?

Credit terms of 3/15, n/30 mean that:

Accounts in the accounts receivable subsidiary ledger are listed alphabetically.

Merchandise is:

When a customer returns defective office supplies, the Sales Returns and Allowances account will be debited.

For each of the following, identify in column 1 the category to which the account belongs, in column 2 the normal balance for the account, and in column 3 the financial statement on which the account balance is reported. -

Prepare the necessary general journal entry for December 10. __________________________________________ __________ __________ __________________________________________ __________ __________ __________________________________________ __________ __________

The accounts receivable subsidiary ledger:

The contra-revenue accounts include:

The accounts receivable subsidiary ledger shows the amount collected from each customer.

Santa Materials sold goods for $3,200 plus 5% sales tax to a charge customer, terms n/30. Which entry is required to record this transaction?

The discount period is longer than the credit period.

Mel's Art studio was moving and sold furniture that was no longer needed for cash. The entry would include:

Accounting Concepts and Procedures

Debits and Credits: Analyzing and Recording Business Transactions

Beginning the Accounting Cycle

The Accounting Cycle Continued

The Accounting Cycle Completed

Banking Procedure and Control of Cash

Calculating Pay and Payroll Taxes: the Beginning of the Payroll Process

Paying, Recording, and Reporting Payroll and Payroll Taxes:

Purchases and Cash Payments

Preparing a Worksheet for a Merchandise Company

Completion of the Accounting Cycle for a Merchandise Company

Accounting for Bad Debts

Notes Receivable and Notes Payable

Accounting for Merchandise Inventory

Accounting for Property, Plant, Equipment, and Intangible Assets

Partnership

Corporations: Organizations and Stock

Corporations: Stock Values, Dividends, Treasury Stocks,

Corporations and Bonds Payable

Statement of Cash Flows

Analyzing Financial Statements

The Voucher System

Departmental Accounting

Manufacturing Accounting

Filters

Prepare the necessary general journal entry for December 16. __________

Prepare the necessary general journal entry for December 10. __________