Chapter 9 Test Review

An organization with the legal rights of a person and which may be owned by many persons.

• capital stock

• cash discount

• corporation

A form prepared by the customer showing the price deduction taken by the customer for returns and allowances.

• debit memorandum

• purchase invoice

• purchases discount

Total shares of ownership in a corporation.

• cash discount

• capital stock

• purchase invoice

Credit allowed for the purchase price of returned merchandise, resulting in a decrease in the customer’s accounts payable.

• purchases discount

• purchase invoice

• purchases return

A deduction that a vendor allows on the invoice amount to encourage prompt payment.

• capital stock

• cash discount

• corporation

A cash discount on purchases taken by a customer.

• debit memorandum

• purchase invoice

• purchases discount

A journal used to record only one kind of transaction.

• purchases return

• share of stock

• special journal

Each unit of ownership in a corporation.

• cash discount

• share of stock

• capital stock

A merchandising business that sells to those who use or consume the goods.

• capital stock

• corporation

• retail merchandising business

An invoice used as a source document for recording a purchase on account transaction.

• purchase invoice

• purchases discount

• purchases return