1
What are the three basic types of business operations?
Service, Merchandising, Manufacturing
Corporation is a type of business operation. (True or False)
False. Corporation is a business structure.
Accounts Receivable Ledger is a type subsidiary ledger. (True or False)
True
A business that is a manufacturer or distributor of goods that sells to retailers or large consumers.
Wholesale business.
This inventory system is used for a relatively small size of operations, where some do not keep track of its inventory daily. In this system, the cost of inventory on hand must be determined by counting merchandise inventory in stock.
Periodic Inventory System
This inventory system is used for a relatively small size of operations, where some do not keep track of its inventory daily. In this system, the cost of inventory on hand must be determined by counting merchandise inventory in stock.
Periodic Inventory System
A sale is entered in the accounting records when the goods are sold or the service is provided. If something is wrong with the goods or service, the firm may give the customer a reduction in price. What is the contra-revenue account used to record the return of the goods?
Sales Allowance
A paper issued by wholesale businesses to customers buying on credit and serves as their bill.
Invoice
This inventory system is used by large businesses to know the number of units and the unit cost for inventory on hand at all times. In this system, the amount of inventory on hand is adjusted for each sale, purchase, or return.
Perpetual Inventory System
Among revenue accounts, liability accounts, expense accounts, and contra revenue accounts - what is the proper classification of Sales Tax Payable account?
Liability
When a return or allowance is related to a credit sale, the normal practice is to issue a certain document to the customer rather than giving a cash refund. What is this document called?
Credit Memorandum
This type of ledger contains detailed information about credit transactions made by customers to the business. It also helps the business verify if any accounts have been paid and helps customers keep track of payments needed or resolve any errors.
Accounts Receivable Ledger
Define a special journal and specify its different types.
Special Journal is a journal that is used to record only one type of transaction.
Types:
Sales Journal, Purchases Journal, Cash Receipts Journal, Cash Payments Journal, General Journal
A common type of credit account offered by businesses to customers with the understanding of paying the amount at a later date, usually within 30 days. This is usually offered to customers whom the business has personal relation or acquaintance to.
Open-Account Credit / Charge-Account Sales
At the end of each accounting period, the balance of the Sales Returns and Allowances account is subtracted from the balance of the Sales account in the Revenue section of the income statement. What do you call the resulting figure for the period?
NET SALES
What is the journal entry for credit card businesses when a customer uses their card for purchases?
Debit: Accounts Receivable
Credit: Sales
Which of the following is not an advantage of using sales journal:
a. Increases efficiency
b. Allows division of work
c. Improves audit trail
d. Increases credit sale
d. Increases credit sale
Suppose that the listing price of a certain company merchandise is worth Php 8,000. However, the net price is only Php 3,200. How much is the trade discount rate given to the merchandise?
60%
Assume that the Sales Returns and Allowances account contains a balance of Php 700.00 at the end of October. Also assume that the Sales account has a balance of Php 37,000.00 at the end of October. How much is the net sales?
37,000 - 700 = 36, 300.
What is the invoice price if the list price is Php 3,000 and the first and second discounts are 10% and 30% respectively.
Php 1,890