Credit terms of 1/10, n/30 mean that A) 1% discount is allowed if the bill is paid withi
Credit terms of 1/10, n/30 mean that
A) 1% discount is allowed if the bill is paid within 10 days, or the entire amount is due within 30 days.
B) a discount is allowed if the bill is paid within 30 days.
C) a discount is allowed if the bill is paid after 10 days.
D) a 1% discount is allowed if the customer pays the bill within 30 days.
42) Accounts of a single type (i.e., Accounts Payable) are kept in this form of ledger:
A) supplemental ledger
B) additional ledger
C) subsidiary ledger
D) general ledger
43) When using a subsidiary ledger, the Accounts Receivable account in the general ledger is called the
A) master account.
B) subsidiary account.
C) receivable account.
D) controlling account.
44) When merchandise is sold on account, it would be recorded in the
A) cash receipts journal.
B) purchases journal.
C) sales journal.
D) cash payments journal.
45) The sales journal is used for
A) recording cash receipts.
B) recording purchases of merchandise.
C) recording credit sales.
D) recording cash sales.
46) Recording to the accounts receivable ledger is done
D) when requested.
47) The purpose of the accounts receivable subsidiary ledger includes all of the following but
A) to keep a running balance of creditor's accounts.
B) to keep a running balance of each customer's account.
C) to provide supporting information for the general ledger control account.
D) to provide information to help collect the customer's account.
48) A credit memorandum is sent to a customer for the purpose of
A) informing the customer an amount has been added to their account.
B) informing the customer an amount has been deducted from their account.
C) informing the customer they are terminated.
D) to inform the customer their account limit is being increased.
49) The Panda Shop sold goods for $300 to a charge customer. The customer returned for credit $120 worth of goods. Which entry is required to record the return transaction?
A) Debit Sales Returns and Allowances $120, credit Accounts Receivable for $120
B) Debit Sales Returns and Allowances for $120, credit Sales for $120
C) Debit Sales $120, credit Sales Returns and Allowances $120
D) Debit Accounts Receivable $120, credit Sales Returns and Allowances for $120
50) Which of the following statements about subsidiary ledgers is most accurate?
A) The subsidiary ledger accounts will never equal the control account in the general ledger.
B) The accounts receivable ledger is a book of accounts that provides supporting detail for Accounts Receivable.
C) The subsidiary ledger accounts will equal the amount in the Sales account.
D) The subsidiary ledger account will equal the amount in the sales account less sales discounts.
51) What does a check mark in the PR column of a journal indicate?
A) An amount has been posted to the general ledger.
B) During the month the subsidiary ledger is updated.
C) An amount has been posted to the controlling account.
D) Nothing has to be posted until the end of the month for this transaction.
52) Which of the following is a true statement concerning Credit Memorandums?
A) Results in a decrease in Sales Returns and Allowances
B) Results in an increase in Sales Returns and Allowances
C) Increases sales
D) Has no effect on net sales