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4 4 questions 1 sales discounts and sales returns and allowances are contra accounts 4297352


4.4   Questions

1) Sales Discounts and Sales Returns and Allowances are contra-accounts of the Sales account.

2) Debit card and credit card sales are counted as cash transactions.

3) A journal entry that has more than one debit or more than one credit is known as a complex journal entry.

4) The account Sales Returns and Allowances is debited when items are returned from a customer.

5) Cost of Goods Sold is the account that is matched with the Sales account to record the company's cost of the inventory that was sold under a perpetual inventory system.

6) A customer purchased items on account from Renaud, Inc. After a few days, the customer returned the goods. Renaud, Inc. will issue a:

A) debit memorandum.

B) return receipt.

C) credit memorandum.

D) refund check.

7) A list of credit customers is called a(n):

A) accounts payable subsidiary ledger.

B) general ledger.

C) accounts receivable subsidiary ledger.

D) general journal.

8) Under the perpetual inventory method, Sales Returns cause:

A) an increase in Cost of Goods Sold.

B) an increase Revenue.

C) a decrease in Cost of Goods Sold.

D) no effect on cost of goods sold.

9) The account in which the revenue earned from the sale of merchandise is entered is:

A) Retained earnings.

B) Sales.

C) Cash.

D) Inventory.

10) Which of the following accounts is NOT used to account for merchandise sales transactions?

A) Accounts Payable

B) Accounts Receivable

C) Sales Discounts

D) Sales Returns and Allowances



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