Deck 7: Focus on Payables When Purchasing and Paying for Inventory Items, Prepare Purchase Orders, Use a Company Credit Card, Record Purchase and Merchandise Discounts, Make Sales Tax Payments

Question 1

When recording an early payment discount on inventory items, you use the account.

A)Purchases Discount
B)Merchandise Discount
C)Sales Discount
D)Discount Expense

Answer 1

B

Question 2

A bill may be paid using cash, a check, or a company credit card.

Answer 2

True

Question 3

A credit card purchase is recorded on a(n) form.

A)Invoice
B)Bill
C)Expense
D)Credit Card

Answer 3

C

Question 4

A purchase return paid for by credit card is recorded as a Vendor Credit.

Question 5

When you do not receive the entire amount of inventory items ordered, you prepare a Purchase Order for the amount on backorder.

Question 6

If you ordered an inventory item, 10 cans of dog food at $2.00 per can and the sales tax rate is 8 percent, you would pay in sales tax.

A)$1.60
B)$21.60
C)$0.00
D)None of the above

Question 7

A Purchase Order is prepared to order inventory items to sell.

Question 8

The Payee is the person or company making a payment.

Question 9

When taking an early payment discount for the purchase of merchandise, the discount amount is recorded on the .

A)Bill
B)Make Payment
C)Check
D)Purchase Order

Question 10

The Sales Tax Liability report is prepared in the .

A)Manage Payables section of Reports
B)Review Expenses and Purchases section of Reports
C)Accountant Reports section of Reports
D)Sales Tax Center