The business needs to record the trade discount in the book of account”. Question Do you agree with the above statement? Justify your answer.
Q: The seller collects sales taxes from the customer at the time of sale and reports the sales taxes as…
A: Sales tax: When the one person sold goods to another person for the business or resold purpose then…
Q: If a customer pays with a credit card and the service has been provided, which of the following…
A: When a customer pays at a shop by Credit card, there incur Credit Card Expenses. The company of the…
Q: In accountinf for sales discounts, most companies use the a. Allowance method b. Gross price…
A: The most commonly used method is the gross price method.in these sales, the discount is deducted…
Q: If merchandise purchased on account is returned, the buyer may inform the seller of the details by…
A: Given, Goods are purchased by-merchandise is returned.
Q: Explain how does the trade credit is offered on open account.
A: Trade credit is the easiest and most important source of short-term finance available to businesses.…
Q: The cash discount also known as purchase discount or sale discount is given to customers for: a.…
A: The cash discount, often known as purchase discount or sale discount, is a type of discount.
Q: Sales Returns and Sales Allowances. What are Sales Discounts? What are their respective normal…
A:
Q: What are the ways that payments by a seller to a customer is done?
A: Accounting is primarily concerned with identifying, recording, measuring, summarizing transactions…
Q: Distinguish between cash discounts and trade discounts for purchases. Is the amount of a trade…
A: Discounts are given to attract customers and increase sales revenue. Discounts can be given as cash…
Q: Which one of the following statements about trade discount is true? It is recorded in books of…
A: Since you have asked multiple questions, we will solve the first question for you. If you want any…
Q: Demonstrate, using practical example how to prepare accounts from the Sales day book and Sales…
A: The sales day book is a manually-maintained ledger in which is recorded the key detailed information…
Q: What is another name for the bill that the seller sends to the buyer when the buyer purchases…
A: Solution: Purchase order is prepared and sent by buyer to seller while placing an order. Receiving…
Q: What are the reasons that a company gives trade discounts?Why are trade discounts not recorded in…
A: A reduction in list or catalog price which is granted by the supplier of goods/services can be…
Q: While reporting revenue, how a company should consider barter arrangement and discount?
A: Revenue Reporting: The process of accounting for revenue for a product you offer to a client is…
Q: Under what circumstances would accounts receivable be posted as a credit balance : A. When the…
A: The different accounts in the business have different balance as debit and credit.
Q: If you are the seller will you provide discount for customers? Why or why not? What type of discount…
A: solution concept In the trade transaction ,the practice of giving and taking…
Q: In a perpetual system, what would be the journal entry for a sales return. (a) Dr. Sales return and…
A: Journal entry is a process of recording the business transactions in the books of accounts for the…
Q: plain why it is important for a company to keep track of how much money in discounts is given out?…
A: . Percent of cash discount since 3/15, n/45 is the credit term between the seller and buyer which…
Q: Which of the following accounts is closed by debiting the account? Purchases Purchase Returns and…
A: For purchases(cash) entry will be Purchases A/C Dr Cash A/c. Cr
Q: Which of the following would not be reported on the financial statement?
A: All transaction that are reported in books of accounts need to be reported in financial statements.…
Q: Briefly explain the accounting treatment for sales returns and allowances. Where are these accounts…
A:
Q: What do you call to a document issued when you purchase or sold on account (credit basis)? 2. It is…
A: The accounting is a process to identify the business transactions, record the transactions and…
Q: A retailer pays for purchased merchandise within the discount window. The retailer would recognize…
A: Accounts Payable - Accounts Payable is the creditor for the company. Company owed some amount for…
Q: When a cxompany extends credit directly to a customer for a purchase, the sale is recorded as a…
A: Sales can be in cash or credit. Cash sales amount is received immediately and credit sales amount is…
Q: Please tell us about Sales Discounts. Why are they necessary? Does this account appear on the…
A: Discount is the amount of reduction in the value of sale or purchase. In other words, discount in…
Q: If merchandise purchased on account is returned, the buyer can inform the seller of the details by…
A: An invoice refers to a bill that is issued by a seller to the buyer. It specifies details related to…
Q: Enter the letter for each term in the blank space beside the definition that it most closely…
A: Sales discount : The discount given by the seller of goods and services to the buyer for promoting…
Q: When a customer returns merchandise previously purchased on credit, the entry for the seller to…
A: Journal entry:- Customer Ac Dr to Sales A/C
Q: When the customer pays the money to the company after the discount period, which one of the…
A: Journal Entry: Journal entry is the act of keeping records of transactions in an accounting journal.…
Q: What accounts are affected when a bill from a vendor supplying you products is recorded
A: when vendors supply products to the company the following accounts will be affected - 1) if we are…
Q: the discount that is being acquired
A: First option is wrong because the cash discount is the discount given by the seller to the buyer for…
Q: Why do businesses often offer "Sales Discounts" to their customers?
A: Sales Discounts - Sales Discounts are the discounts given by the company to the customers. This…
Q: For a Credit Invoice Received, which entry should be made? debit to sales returns and…
A: Journal entry is the process of recording the business transactions in the books of accounts for the…
Q: If merchandise sold on account is returned to the seller the seller may inform the customer of the…
A: Concept introduction: An organization can be manufacturing, servicing of merchandising type. For a…
Q: To intensify the collection of receivables, Kate's Trading offered 2/10, n/30 to customers. What…
A: The discount is the benefits given by reduction in the amount to be paid.
Q: It is used to who is responsible for paying shipping and when the title of the goods passes from…
A: The goods and services are usually exchanged between two parties. One is seller and the other is…
Q: Which of the following journal entry is correct for the transactions of goods returned by a…
A: When we make a sales to customer, we pass the following entry:- Trade receivables Dr To…
Q: When a company decides to extend credit to consumers, it is making an investment decision in: a.…
A: A company often decides to extend credit to consumers. The decision is made on the logic that credit…
Q: A seller generally records sales at the full invoice price, butthe buyer often records purchases at…
A: A seller generally records sales at full invoice price, but buyer often records purchase at net…
Q: What is the purpose of the Purchase Returns and Allowances account? Why not just record a purchase…
A: Purchase accounts are used in periodic inventory system as a general ledger account in which…
Q: The journal entry to record a credit sale ignoring cost of goods sold is ANSWER: Accounts…
A: Journal Entry for Credit sale : Account Name Debit Credit Accounts…
Q: When a seller receives payment from a customer who takes the discount for paying early, the journal…
A: When a seller receives payment within discount period, cash account will be debited with accounts…
Q: hen the seller advances the transportation costs and the terms of sale are FOB shipping point, the…
A: Solution: When the seller advances the transportation costs and the terms of sale are FOB shipping…
Q: Explain in detail different types of documentation that the business would expect to change hands in…
A: We’ll answer the first question since the exact one wasn’t specified. Please submit a new question…
“The business needs to record the trade discount in the book of account”.
Question
Do you agree with the above statement? Justify your answer.
Step by step
Solved in 2 steps
- a) Explain in detail different types of documentation that the business would expect to change hands in purchase, sales, purchase returns and sales returns etc. b) Show the model of atleast one Credit Sales invoice, Purchase invoice, Debit note and Credit note. (you can use imaginary figure) c) What are policies for trade discount/cash discount, Is there any products are subject to trade discount and why? Explain the terms and conditions in detail.If a customer pays with a credit card and the service has been provided, which of the following accounts will be used to record the sales entry for this transaction? A. Cost of Goods Sold, Merchandise Inventory, Sales Revenue B. Sales Revenue, Credit Card Expense, Accounts Receivable C. Accounts Receivable, Merchandise Inventory, Credit Card Expense D. Cost of Goods Sold, Credit Card Expense, Sales RevenueLet's assume the merchandiser (buyer) pays after the discount period expires, how will the vendor (seller) journalize the Jeff. Fvpayment? Add the appropriate amount to the appropriate accounts provided below. Use the invoice provided.
- If a customer pays with a credit card and the service has been provided, which of the following accounts will be used to record the sales entry for this transaction? Elaborate in your response asides from choosing the correct choice. A. Cost of Goods Sold, Merchandise Inventory, Sales Revenue B. Sales Revenue, Credit Card Expense, Accounts Receivable C. Accounts Receivable, Merchandise Inventory, Credit Card Expense D. Cost of Goods Sold, Credit Card Expense, Sales RevenueIf you are the seller will you provide discount for customers? Why or why not? What type of discount will you provide for your customers? How will you account for this discount? Answer this by giving a sample problem including the debit and credit entries. If you are the buyer, will you get discounts for your suppliers? Why or why not?When goods are sold on credit the account of a customer is called : Select one: a. Purchases Return b. Account Payable c. Sales Return d. Account Receivable
- 1. What do you call to a document issued when you purchase or sold on account (credit basis)? 2. It is the nominal price of an item before any trade discount.This module discusses discounts given out to customers based on payment terms, such as 2/10, n/30. : What would the credit terms 3/15, n/45 stand for? Explain why it is important for a company to keep track of how much money in discounts is given out? What account is used to track discounts? From a business owner's point of view, what are the advantages of allowing discounts? From a business owner's point of view, what are the disadvantages of allowing discounts?Kate Trading made an early payment to its suppliers to take advantage of the discount offered by the supplier. What account is most likely used for the discount that is being acquired by Kate Trading? cash discount trade discount sales discount purchase discount
- The return of goods by a customer ( Sales Return ) should be credited in the ledger account of ? Select one: a. Sales account O b. Accounts receivable account O c. Purchase Return account O d. Sales Return accountWhile reporting revenue, how a company should consider barter arrangement and discount?Choose the one correct answer. A credit balance to a client's accounts payable account representing right to receive payment for delivery of goods should be properly classified as: A. Current LiabilitiesB.Non-Current LiabilitiesC. Trade ReceivablesD. Non-trade Receivables (Current)E. Non-trade Receivables (Non-Current)
