When should revenue from the sale of merchandise normally be recognized? A)When the customer takes possession of the merchandise.   B)When the customer takes possession of the merchandise, if sold for cash, or when payment is received, if sold on credit.   C)Either on the date the customer takes possession of the merchandise or on the date on which the customer pays.   D)When the customer pays for the merchandise.

Q: With the accrual basis of accounting, revenue from a credit sale is recognized Multiple Choice…

A: Accrual basis of accounting: Accrual basis of accounting refers to recognizing the expenses and…

Q: The realisation concept determines when goods sent on credit to customers are to be included in the…

A: Sales: It is an activity of selling goods and services in exchange for money.

Q: Which of the following will be called as an expense of a Merchandise business? a. Sale of…

A: a.) Sale of merchandise inventory means sales of goods so it is and income. b.) Trade discount is…

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: Identify if the two statements are either true or false. 1. The bill of lading is a document…

A: The given statement answer is given in the below step.

Q: The credit period during which the buyer of merchandise is allowed to pay usually begins with what…

A: Credit period generally begins with the date of sales as recorded on the invoice.If the payment is…

Q: What is the account title used for revenue when goods are delivered to customers?

A: Account title: An account title is a unique name assigned to an account in an accounting system. An…

Q: What effects on a retail store's accounting equation occur when merchandise returned by customers is…

A: Introduction:- The following Accounting Equation used for preparation of balance sheet as follows…

Q: When does a company typically recognize revenue for a bill-and-hold sale?

A: Bill and hold agreements represent a sales arrangement in which the buyer pays for the item or items…

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: When a customer (buyer) returns merchandise purchased on credit,what is to be done?

A: Sales Returns: It is the merchandise returned by a buyer to a seller due to many reasons like excess…

Q: When does the cost of inventory become an expense?a. When cash is collected from the customerb. When…

A: Answer: b. When inventory is delivered to a customer

Q: Due to this accounting principle I postpone the moment I reveal expenses on my goods to the moment I…

A: Principle means the fundamental upon which the books of account are prepared.

Q: What is the normal balance of the following accounts: (a) Cost of Merchandise Sold, (b) Customer…

A:

Q: When purchases of merchandise are made on account and the perpetual method is used, the transaction…

A: If a business entity purchases the merchandise Inventory on account, hereunder double-entry system…

Q: Which two accounts are used to recognize shipping charges for a buyer, assuming the buyerpurchases…

A: The term "free on board" (FOB) relates to whether the vendor or customer is liable for damaged or…

Q: When granting a sales allowance, is there a return of merchandise inventory from the customer?…

A: Sales allowance is an allowance where reduction in reduction in selling price is granted to customer…

Q: What happens when a client (buyer) returns goods bought on credit

A: A client (buyer) returns goods bought on credit shown here:

Q: What is the name of the account used to record purchases of merchandise inventory?

A: The concept of merchandise inventory is associated with cost of goods that is in hand and available…

Q: How would you find the invoice amount of merchandise that was returned in

A: When the merchandise is returned, The invoice amount of return will be credited to the customer's…

Q: When should a seller view a payment to its customer as a refund of part of the price paid by the…

A: Revenue recognition principle:   The revenue recognition principle refers to the revenue that…

Q: After the amount due on a sale of s33,900, terms 2/10, neom, is received from a customer within the…

A:

Q: When merchandise purchased on account is returned under the perpetual inventory system, the buyer…

A: Introduction: Journals: Recording of a business transactions in a chronological order. First step in…

Q: which two accounts are used to recognize shipping charges for a buyer assuming the buyer purchases…

A: Shipping cost depends upon the terms of the contract. Generally, there are two types of conditions.…

Q: Which of the following situations may give rise to unearned revenue? O Providing trade credit to…

A: The Unearned revenue is the cash received feom customers but services would be provided in the…

Q: Which account will be debited to record the purchase of merchandise on credit under periodic…

A: Introduction: Journals: Recording of a business transactions in a chronological order. First step in…

Q: when a buyer returns merchandise purchased for cash, the buyer will record the transaction as a…

A: The purchase return in the books of the buyer under the perpetual inventory is to debit the accounts…

Q: A company sells merchandise for cash. This transaction is recorded as: Group of answer choices A…

A: Golden Rules: There are three golden rules nominal, personal, and real. All financial transactions…

Q: Is purchases is the account to be debited upon purchase of merchandise under the perpetual inventory…

A: Perpetual Inventory System It is the most important part of the business to enter the transactions…

Q: If a customer purchases merchandise on credit and return the defective merchandise before payment,…

A: Perpetual inventory system: The perpetual inventory system records and updates the inventory after…

Q: A retail store received cash and issued gift certificates that are redeemable in merchandise. How…

A: Solution: When cash is received in lieu of gift certificates, deferred revenue is credited. When…

Q: Let's assume the merchandiser (buyer) pays after the discount period expires, how will the vendor…

A: The payment terms of Sports Emporium Sales is 2/10, n/30. It means if payment is done within 10 days…

Q: f merchandise sold on account is returned to the seller, the seller may inform the customer of the…

A: Answer -  Correct Answer is - Credit memorandum, Because, A credit note or credit memorandum is a…

Q: When does a company recognize revenue for a sale of a gift card?

A: Gift card: Prepayment which is made by the customer for the future purchase is known as a gift card.…

Q: credit terms are terms for a. when the payments for merchandise are to be made b. when inventory is…

A: Credit terms refers to the agreement made between the seller and the buyer which defines the timing…

Q: How do you determine the invoice of merchandise returned?

A: Merchandise return refers to the inventory that is returned by the customer to the seller for their…

Q: Return of merchandise sold on account is recorded in the: A purchases journal B either sales or…

A: Merchandise is very important asset for the business. Purchase and sale of merchandise is recorded…

Q: If a customer purchases merchandise on credit and returns the defective merchandise beforepayment,…

A: When customer made purchases on credit from the business, then one side it will generate accounts…

Q: Enter the letter for each term in the blank space beside the definition that it most closely…

A: Meaning of Sales discount Sales discount is the amount of discount given on the amount of sales made…

Q: Match each phrase with its definition. 1. Seller's description of a cash discount granted to buyers…

A:

Q: Which of the following accounts has a normal debit balance? a.Accounts Payable b.Sales c.Interest…

A: Accounts Payable: Accounts Payable means money owed by a company to its creditors. It is an current…

Q: Why is the purchase journal used for journalizing the purchase of merchandise for resale on account…

A: Purchase journal is a separate book kept in the company to maintain and track the information of…

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…

Financial Transaction Analysis

The transaction analysis is done with the help of the accounting equation. The basic accounting equation is alternatively known as the balance sheet equation is based on the double-entry system which says that for each transaction happening in a business, at least two accounts should be affected I.e. both the debit side and the credit side should be equal. The Accounting Equation is