Accounting Practice Quiz - Transactions Overview

The total cost of merchandise purchased, after subtracting purchase returns and allowances and purchase discounts.

Total cost of merchandise acquired, including freight in.

A discount offered by a seller to encourage customers to buy a large quantity of merchandise or pay early.

A discount offered for early payment; 2% discount if paid within 10 days, full payment otherwise within 30 days.

The sum of beginning inventory and purchases for a period.

The amount of money owed to a company by its customers for goods or services sold on credit.

The owner's stake in a business after all liabilities are accounted for.

The percentage reduction in the price of goods when a buyer pays within a specified period.

Reduction in the price of a product or service if payment is made before a set due date.

The amount of goods a business buys for resale.

Expenses related to shipping merchandise to a company.

Merchandise that a customer sends back to the seller.

Time frame for a buyer to receive a reduction in price by paying an invoice early.

A document issued by a seller to a customer, crediting their account for a returned item or an adjustment made to their invoice. It reduces the customer's outstanding balance.

A payment made towards an outstanding invoice that covers only a portion of the total amount owed.

The actual amount of money received from a customer after accounting for any discounts, returns, or adjustments.

The total amount due on a loan or note at the end of its term, which includes the original principal and accrued interest.

A discount offered by a seller to encourage early payment for goods purchased.

The amount deducted from the total purchases for returned goods or goods that are damaged or defective.

The cost of shipping goods from the seller to the buyer when the seller is responsible for the shipping costs. The buyer pays for the goods upon arrival.

The amount deducted from the total sales for returned goods or goods that are damaged or defective.

The cost of shipping goods from the seller to the buyer when the buyer is responsible for the shipping costs. The buyer pays for the shipping separately.

Purchases returns and allowances are reductions in the cost of goods purchased because of defective or damaged goods, or because the buyer is returning unwanted goods.

A purchase discount is a reduction in the cost of goods purchased because of early payment, or because of buying in bulk.

Freight in is the cost of transporting purchased goods from the supplier to the buyer's location.

The cost of goods available for sale represents the total value of goods that a business has available to sell during a period. It includes the beginning inventory plus the net cost of purchases.

FOB shipping point means the buyer assumes ownership and responsibility for the goods as soon as they leave the seller's premises.

A discount offered to buyers for early payment. It's a way to encourage quicker payment.

The invoice price is the price of goods after trade discount.