tif_ch14 - CHAPTER 14 Multiple-Choice Questions 1 easy d...

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CHAPTER 14 Multiple-Choice Questions 1. easy With the exception of cash sales, every transaction in the sales and collection cycle ultimately is included in which account(s)? d a. Cash. b. Accounts receivable. c. Allowance for doubtful accounts. d. b and c. 2. easy Which of the following is not one of the five classes of transactions included in the sales and collection cycle? d a. Sales returns and allowances. b. Charge-off of uncollectible accounts. c. Bad debt expense. d. Depreciation expense—store equipment. 3. What event initiates a transaction in the sales and collection cycle? easy a. Receipt of cash. d b. Delivery of product to a customer. c. Identification of a new customer. d. Customer request for goods. 4. What critical event must take place before goods can be shipped? easy a. Determination of correct delivery address. b b. Credit approval. c. Receipt of cash. d. Receipt of purchase order from the customer. 5. Before goods are shipped on account, a properly authorized person must easy a. prepare the sales invoice. c b. approve the journal entry. c. approve credit. d. verify that the unit price is accurate. 6. A document prepared to initiate shipment of the goods sold is the easy a. sales order. b b. bill of lading. c. sales invoice. d. customer order. 7. The document used to indicate to the customer the amount of a sale and payment due date is the easy a. sales invoice. a b. bill of lading. c. purchase order. d. sales order. 14-1
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8. Which of the following is not a business function within the “Sales” class of transactions? easy a. Processing customer orders. c b. Granting credit. c. Processing and recording sales returns and allowances. d. Shipping goods. 9. The total of the individual account balances in the accounts receivable master file equals the easy a. total sales for the period. d b. balance of the sales account in the general ledger. c. total sales less the total cash received for the period. d. balance of the accounts receivable account in the general ledger. 10. easy A listing of the amount owed by each customer which shows how long each component part has been due is the d a. trial balance. b. working trial balance. c. accounts receivable trial balance. d. aged accounts receivable trial balance. 11. easy b A document sent to each customer showing his or her beginning accounts receivable balance and the amount and date of each sale, cash payment received, credit memo issued, and the ending balance is the a. accounts receivable subsidiary ledger. b. monthly statement. c. remittance advice. d. sales invoice. 12. The document which accompanies the customer’s payment is the easy a. credit memo. b b. remittance advice. c. sales invoice. d.
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This note was uploaded on 10/13/2010 for the course ACCOUNTING 25668652 taught by Professor Ommaya during the Spring '10 term at Abraham Baldwin Agricultural College.

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tif_ch14 - CHAPTER 14 Multiple-Choice Questions 1 easy d...

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