10.3   Learning Objective 10-3

1) A list of creditors with balances owed is called:

A) a schedule of accounts receivable.

B) a schedule of accounts payable.

C) a list of suppliers.

D) a trade list.

2) The entry to record returned merchandise to Vine Company is:

A) debit Purchases Returns and Allowances; credit Accounts Receivable in the general ledger.

B) debit Accounts Payable; credit Purchases.

C) debit Accounts Payable/Vans Company in the accounts payable subsidiary ledger and debit Accounts Payable in the general ledger; credit Purchases Returns and Allowances.

D) debit Purchases; credit Accounts Payable.

3) Jackson purchased $500 of goods and received credit terms of 2/10, n/30. How much did he pay if payment was made during the discount period?

A) $450

B) $510

C) $500

D) $490

4) The entry to record a payment on a $650 account within the 2% discount period would include a:

A) debit to Accounts Payable for $637.

B) debit to Accounts Payable for $650.

C) credit to Purchases for $637.

D) debit to Cash for $650.

5) Heidi’s Accessories bought 50 necklaces for $10 each on account. The invoice included a 6% sales tax and payment terms of 2/10, n/30. In addition, 5 necklaces were returned prior to payment. The entry to record the payment (within the discount period) would include:

A) a credit to Cash for $477.

B) a credit to Cash for $468.

C) a credit to Accounts Receivable for $477.

D) a credit to Accounts Receivable for $468.

6) Returned merchandise under the periodic inventory method. This will be recorded with:

A) a debit to Accounts Payable and a credit to Purchases Returns and Allowances.

B) a debit to Merchandise Inventory and a credit to Cash.

C) a credit to Accounts Payable and a debit to Merchandise Inventory.

D) a debit to Accounts Payable and a credit to Merchandise Inventory.

7) Jemco bought goods for $300 on credit. Jemco returned $50 worth of goods. Terms of the sale were 2/10, n/30. If Jemco pays the amount owed within the discount period, what is the amount they should pay?

A) $300

B) $255

C) $245

D) $250

8) Returned merchandise paid for within the discount period for a Cash refund. This will be recorded with:

A) a credit to a liability.

B) a credit to an asset.

C) a debit to a liability.

D) a debit to an asset.

9) Jenny’s Accessories bought 50 necklaces for $10 each on account. The invoice included a 2% sales tax and payment terms of 2/10, n/30. In addition, 5 necklaces were returned prior to payment. The entry to record the return would include:

A) a debit to Accounts Payable for $50.00.

B) a debit to Accounts Payable for $51.00.

C) a debit to Purchases Returns and Allowances for $50.00.

D) a debit to Purchases Returns and Allowances for $51.00.

10) The accounts payable subsidiary ledger:

A) lists accounts alphabetically.

B) lists accounts for which the company owes money.

C) has a controlling account in the general ledger.

D) All of the above are correct.

 

 



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