Accounting: Chapter 9 & 10 Review

What are the two activities of a merchandising business?

• Purchasing and using services

• Purchasing and selling goods

• Making and selling goods

• Offering and selling services

A corporation is formed by applying to a state government.

• True

• False

An accounts payable ledger form has

• a debit balance column

• no balance column

• a credit balance column

• both a debit and credit column

Classify the account Purchases

How would a purchase of merchandise on account be journalized?

• Debit - Purchases; Credit - Accounts Payable/Vendor

• Debit - Purchases; Credit - Accounts Receivable/Customer

• Debit - Accounts Payable/Vendor

  Credit - Purchases

• Debit - Accounts Receivable/Customer; Credit - Purchases

A purchase of merchandise for cash would be posted

• individually to Purchases and Accounts Payable

• individually to Purchases

• as part of a column total to Purchases

• as part of column totals to Purchases and Accounts Payable

Supplies bought for use in a business are recorded in the

• Supplies Expense account

• Purchases account

• Supplies account

• Cash account

A cash payments journal may be set up to accommodate a business's frequent cash payments transactions.

• True

• False

What is the source document for merchandise purchased on account?

• Receipt

• Purchase invoice

• Memorandum

• Check

What is the source document when merchandise is purchased for cash?

• Check

• Memorandum

• Purchase invoice

• Receipt