Question 1

If management wanted to determine if customers were returning goods at a higher rate than usual, it could use the Sales Discounts account to analyze the information.

Accepted Answer

A) True 
 B)False

Question 2

Define and compare the accounts receivable subsidiary ledger with the controlling account, Accounts Receivable.

Accepted Answer

Accounts receivable subsidiary ledger is

Question 3

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 4

The normal balance of Sales Tax Payable is a debit.

Accepted Answer

A) True 
 B)False

Question 5

To show that you have posted to an account in the General Ledger, you use a checkmark.

Accepted Answer

A) True 
 B)False

Question 6

Prepare the necessary general journal entry for December 2.
__________________________________________ __________ __________
__________________________________________ __________ __________
__________________________________________ __________ __________

Accepted Answer

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

Question 7

The Bay Co. had the following transactions involving the sale of merchandise. You are to prepare the necessary general journal entries. All sales are subject to credit terms of 1/10, n/30. No sales taxes are applicable.
July 16 Sold merchandise on account with an invoice price of $5,500 to Carter and Co.
July 16 Sold merchandise on account with an invoice price of $6,000 to the Ping Co.
July 20 Ping Co. returned merchandise with an invoice price of $1,000.
July 25 Received full payment from Carter and Co.
July 28 Received full payment from Ping Co.
-Prepare the necessary general journal entry for July 28.
__________________________________________ __________ __________
__________________________________________ __________ __________
__________________________________________ __________ __________

Accepted Answer

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

Question 8

An example of a subsidiary ledger is the revenue ledger.

Accepted Answer

A) True 
 B)False

Question 9

The return of merchandise by a credit customer was recorded with a debit to Accounts Payable and a credit to Accounts Receivable and the subsidiary ledger. This error will cause:

Accepted Answer

A)  the net income for the period to be overstated. 
B)  the net Sales for the period to be overstated 
C)  the control account to not agree with the subsidiary ledger. 
D)  the assets to be overstated. 
A)  the net income for the period to be overstated. 
B)  the net Sales for the period to be overstated 
C)  the control account to not agree with the subsidiary ledger. 
D)  the assets to be overstated.

Question 10

The Sales Returns and Allowances account is a revenue account.

Accepted Answer

A) True 
 B)False

Question 11

The following are transactions for Bill for the month of October. Indicate how the following transactions would be recorded by completing the necessary journal entries as appropriate (omit explanations). Also post to the General Journal, General Ledger, and Subsidiary Ledgers as appropriate.
Nov. 1 Bill invested $20,000 in his business.
Nov. 3 Sold $2,500 of merchandise on account to H. Baxter, sales invoice No. 1, terms 1/10, n/30.
Nov. 5 Sold $1,200 of merchandise on account to T. Toms, sales invoice No. 2, terms 1/10, n/30.
Nov. 13 Received cash from H. Baxter in payment for November 3 transaction, less the discount.
Nov. 14 Issued credit memorandum No. 1 to T. Toms for $100 for merchandise returned from
November 5 sale on account.
Nov. 15 Received cash from T. Toms for the amount due, less the discount.
GENERAL JOURNAL

Accepted Answer

The answer of The following are transactions for Bill for...

Question 12

Compare and discuss a discount period versus a credit period.

Accepted Answer

A credit period is the length of time al

Question 13

A checkmark in the PR column in the general journal means:

Accepted Answer

A)  the entry was recorded correctly. 
B)  the amount was posted to the controlling account. 
C)  the amount was recorded in the subsidiary ledger. 
D)  the payroll was paid. 
A)  the entry was recorded correctly. 
B)  the amount was posted to the controlling account. 
C)  the amount was recorded in the subsidiary ledger. 
D)  the payroll was paid.

Question 14

Determine the amount of cash collected on a credit sale in the amount of $5,000, subject to a 5% sales tax when $500 worth of merchandise has already been returned for credit. Assume cash is collected after the discount period.
$ ________

Accepted Answer

The answer of Determine the amount of cash collected on...

Question 15

Calculate gross sales:
net sales = $100,000
sales returns and allowances = $25,000
sales discounts = $30,000
accounts receivable = $12,000

Accepted Answer

The answer of Calculate gross sales:
net sales = $100,000
sales returns...

Question 16

Net sales equal:

Accepted Answer

A)  gross sales. 
B)  gross sales - sales returns and allowances. 
C)  gross sales - sales returns and allowances - sales discounts. 
D)  gross sales - gross profit. 
A)  gross sales. 
B)  gross sales - sales returns and allowances. 
C)  gross sales - sales returns and allowances - sales discounts. 
D)  gross sales - gross profit.

Question 17

Determine the amount of cash collected at the time of making a sale of $8,500 worth of merchandise subject to a 6% sales tax.
$ ________

Accepted Answer

The answer of Determine the amount of cash collected at...

Question 18

The controlling account is found in the subsidiary ledger and it summarizes or controls the general ledger account.

Accepted Answer

A) True 
 B)False

Question 19

The Bay Co. had the following transactions involving the sale of merchandise. You are to prepare the necessary general journal entries. All sales are subject to credit terms of 1/10, n/30. No sales taxes are applicable.
July 16 Sold merchandise on account with an invoice price of $5,500 to Carter and Co.
July 16 Sold merchandise on account with an invoice price of $6,000 to the Ping Co.
July 20 Ping Co. returned merchandise with an invoice price of $1,000.
July 25 Received full payment from Carter and Co.
July 28 Received full payment from Ping Co.
-Prepare the necessary general journal entry for July 20.
__________________________________________ __________ __________
__________________________________________ __________ __________
__________________________________________ __________ __________

Accepted Answer

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

Question 20

Explain why the account Sales Tax Payable is credited when a sale is made subject to a sales tax?

Accepted Answer

Sales Tax Payable is a liabili

Exam 9: Sales and Cash Receipts

If management wanted to determine if customers were returning goods at a higher rate than usual, it could use the Sales Discounts account to analyze the information.

Define and compare the accounts receivable subsidiary ledger with the controlling account, Accounts Receivable.

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. -

The normal balance of Sales Tax Payable is a debit.

To show that you have posted to an account in the General Ledger, you use a checkmark.

Prepare the necessary general journal entry for December 2. __________________________________________ __________ __________ __________________________________________ __________ __________ __________________________________________ __________ __________

An example of a subsidiary ledger is the revenue ledger.

The return of merchandise by a credit customer was recorded with a debit to Accounts Payable and a credit to Accounts Receivable and the subsidiary ledger. This error will cause:

The Sales Returns and Allowances account is a revenue account.

Compare and discuss a discount period versus a credit period.

A checkmark in the PR column in the general journal means:

Determine the amount of cash collected on a credit sale in the amount of $5,000, subject to a 5% sales tax when $500 worth of merchandise has already been returned for credit. Assume cash is collected after the discount period. $ ________

Calculate gross sales: net sales = $100,000 sales returns and allowances = $25,000 sales discounts = $30,000 accounts receivable = $12,000

Net sales equal:

Determine the amount of cash collected at the time of making a sale of $8,500 worth of merchandise subject to a 6% sales tax. $ ________

The controlling account is found in the subsidiary ledger and it summarizes or controls the general ledger account.

Explain why the account Sales Tax Payable is credited when a sale is made subject to a sales tax?

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 2. __________