Accounting 1 Chapter 9 Review

An invoice used as a source document for recording a purchase on account transaction.

If merch is purch. for $1000 on 8/1, with terms of 2/10, n/30, the amt due 8/9 is $980.00

When several journals are used, an abbreviation is used in the Post. Ref. column of a ledger

Purchases Returns and Allowances is a contra (opposite) account to Cost of Merchandise

Since contra accounts are offsets to their related accounts, contra account normal balances are

Purchases Discount is increased by a credit entry

Trade discounts normally are recorded in the purchases discount account

A deduction that a vendor allows on the invoice amount to encourage prompt payment

Total shares of ownership in a corporation

A form prepared by the customer showing the price deduction taken by the customer for returns

The source document for a cash purchase is

Purchases returns and allowances

Supplies bought for use in a business are recorded in the

The purchases account is classified as

Each unit of ownership in a corporation

An organization with the legal rights of a person and which may be owned by many persons

The purchases account is increased by a credit and decreased by a debit

If the actual petty cash on hand is $53 but records show that $55 should be on hand = cash over

A merchandising business that sells to those who use or consume the goods.

Credit allowed for the purchase price of returned merch., resulting in a decrease in Acct. Pay.

A journal used to record only one kind of transaction

A cash discount on purchases taken by a customer

The term of sale 1/10, n/30 mean customers may deduct 1% of the invoice if paid off in 30 days.

When purchases are recorded at their cost, Historical Cost accounting concept is being applied