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Chapter 07 - Accounting for Sales and Accounts Receivable
7-38
78. Selected balances from the general ledger of the Valley Video Rentals on May 31, 2013,
are listed below. Use the appropriate data to prepare the Revenue section of the firm's income
statement for the month ended May 31, 2013.
Chapter 07 - Accounting for Sales and Accounts Receivable
7-43
Matching Questions
84. Match the accounting terms with the description by entering the proper number.
1. A journal used to record only one type of
transaction
Accounts receivable
ledger
8
2. A business that sells services
Contra revenue
account
22
3. A system that allows the sale of services or goods
with the understanding that payment will be made at a
later date
Credit
memorandum
11
4. A business that sells goods that it has produced
Sales return
6
5. An established retail price
Subsidiary ledger
12
6. A firm's acceptance of a return of goods from a
customer
Service business
2
7. A listing of all balances of the accounts in the
accounts receivable subsidiary ledger
Net price
10
8. A subsidiary ledger that contains credit customer
accounts
Merchandise
inventory
21
9. A business that sells goods purchased for resale
Open-account
credit
3
10. The list price less all trade discounts
Sales allowance
15
11. A note verifying that a customer's account is being
reduced by the amount of a sales return or sales
allowance plus any sales tax that may have been
involved
List price
5
12. A ledger dedicated to accounts of a single type
and showing details to support a general ledger
account
Wholesale business
16
13. A special journal used to record sales of
merchandise on credit
Trade discount
18
14. The difference between the balance in the Sales
account and the balance in the Sales Returns and
Allowances account
Net sales
14
15. A reduction in the price originally charged to
customers for goods or services
Sales journal
13
16. A business that manufactures or distributes goods
to retail businesses or large consumers such as hotels
and hospitals
Control account
19
17. A business that sells directly to individual
consumers
Invoice
20
18. A reduction from list price
Special journal
1
19. An account that links a subsidiary ledger and the
general ledger since its balance summarizes the
balances of the accounts in the subsidiary ledger
Merchandising
business
9
