Accounting 1 - 4.01 & 4.02 Review

Match the following

• sales discount

• A cash discount issued by the seller is a(n) ___.

• receipt

• An account whose balance decreases another account's balance is a(n) ___.

• subsidiary ledger

• A(n) ___ is a book that is summarized in a controlling account in the general ledger.

• bankcard

• A(n) ___ is a form that serves as a record of cash received.

• contra account

• A(n) ___ is a credit card issued by a bank and honored by many businesses.

Match the following

• cash receipt

• A(n) ___ is a transaction that occurs when a business receives full payment for the merchandise sold at the time of the sale.

• retailer

• The ___ contains accounts of the charge customers of a business.

• accounts receivable subsidiary ledger

• A(n) ___ is a business that sells to the final user.

• sales slip

• The cash received by a business is referred to as a(n) ___.

• cash sale

• A form that lists the details of a sale and is used as a record of the transaction is a(n) ___.

Match the following

• charge customer

• The goods a business buys for resale to customers are known as ___.

• sales return

• Accounts Receivable is a(n) ___ because its balance must equal the total of the accounts receivable subsidiary ledger.

• controlling account

• Merchandise returned to the seller for full credit is a(n) ___.

• sales tax

• A(n) ___ is a customer to whom a sale on account is made.

• merchandise

• Many states and some cities require that a business add a(n) ___, as a percentage of the selling price of the goods, at the time of the sale.

Match the following

• sales on account

• A(n) ___ permits a customer to pay for the merchandise at a later date.

• credit card

• A charge customer is entitled to charge merchandise with a(n) ___.

• credit terms

• The items of merchandise a business has in stock are referred to as ___.

• wholesaler

• A(n) ___ is a business that sells to retailers.

• inventory

• The ___ of a sale state the time allowed for payment for sale on account.

Match the following

• sales

• The revenue account for merchandising business is ___.

• cash discount

• A(n) ___ is a document prepared by the seller granting credit for damaged or returned merchandise.

• credit memorandum

  (memo)

• An example of a(n) ___ is Wal-Mart.

• merchandising business

  (retailer)

• The amount a customer may deduct if the payment for merchandise is made within a certain time is a(n) ___.

• sales allowance

• A price reduction granted by a business for damaged goods kept by the customer is called a(n) ___.

True or False: Retailers include clothing stores, CD and tape shops, and automobile dealerships.

• True

• False

True or False: The account Merchandise Inventory is classified in the chart of accounts as an asset.

• True

• False

True or False: A sale on account is paid for in cash when the merchandise is sold.

• True

• False

True or False: A sales slip is usually prepared in multiple copies with the customer receiving the original and the business keeping the remaining copies.

• True

• False

True or False: Sales taxes are not usually charged to governmental agencies.

• True

• False