Ch. 10 True/False Exam Review

The amount of sales tax collected is an expense of operating a business.

• True

• False

Most states do not require a business to collect sales tax from customers.

• True

• False

Regardless of when payment is received, the revenue should be recorded when a sale is made, not on the date cash is received. (

• True

• False

An invoice is a form that describes the goods or services sold, the quantity and the price, and the terms of the sale.

• True

• False

The accounts receivable ledger form is based on the general ledger form and contains the same columns, except the Credit Balance amount column.

• True

• False

Sales tax rates are usually stated as a percentage of sales.

• True

• False

Only the federal government can exempt from sales taxes some types of merchandise or sales to certain types of customers.

• True

• False

While the seller considers an invoice for a sale on account to be a sales invoice, the same invoice is considered by the customer to be a purchase invoice.

• True

• False

Credit card and debit card sales are treated as cash sales because the business receives its cash in a very short time.

• True

• False

The invoice used as a source document for recording a sale on account is often referred to as a sales invoice, a sales ticket, or a sales slip.

• True

• False