Solved

Match Each Definition to Its Term

Question 199

Matching

Match each definition to its term

Premises:

Responses:

The description of the amounts and timing of payments from a buyer to a seller

Perpetual inventory system

Net sales less cost of goods sold

Periodic inventory system

The amount of time allowed before full payment is due

Discount period

An accounting method that continually updates accounting records for merchandise transactions

Debit memorandum

A notification that the sender has debited the recipient's account kept by the sender

Selling expenses

A cash discount granted to customers for paying within the discount period

Credit memorandum

The expenses of promoting sales, by displaying and advertising merchandise, making sales and delivering goods to customers

Sales discount

An accounting method that updates the accounting records for merchandise transactions only at the end of a period

Gross profit

The time period in which a cash discount is available and a reduced payment can be made by the buyer

Credit terms

A notification that the sender has credited the recipient's account kept by the sender

Credit period

Premises:

The description of the amounts and timing of payments from a buyer to a seller

Net sales less cost of goods sold

The amount of time allowed before full payment is due

An accounting method that continually updates accounting records for merchandise transactions

A notification that the sender has debited the recipient's account kept by the sender

A cash discount granted to customers for paying within the discount period

The expenses of promoting sales, by displaying and advertising merchandise, making sales and delivering goods to customers

An accounting method that updates the accounting records for merchandise transactions only at the end of a period

The time period in which a cash discount is available and a reduced payment can be made by the buyer

A notification that the sender has credited the recipient's account kept by the sender

Responses:

Perpetual inventory system

Periodic inventory system

Discount period

Debit memorandum

Selling expenses

Credit memorandum

Sales discount

Gross profit

Credit terms

Credit period

Correct Answer:

Premises:

Responses:

The description of the amounts and timing of payments from a buyer to a seller

Net sales less cost of goods sold

The amount of time allowed before full payment is due

An accounting method that continually updates accounting records for merchandise transactions

A notification that the sender has debited the recipient's account kept by the sender

A cash discount granted to customers for paying within the discount period

The expenses of promoting sales, by displaying and advertising merchandise, making sales and delivering goods to customers

An accounting method that updates the accounting records for merchandise transactions only at the end of a period

The time period in which a cash discount is available and a reduced payment can be made by the buyer

A notification that the sender has credited the recipient's account kept by the sender