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Accounting Terms

InternationalSales

Sales OnAccount

CashReceipts

GeneralJournal

A special journal used to record only sales of merchandise on

account.

Sales Journal

A deduction that a vendor allows on the invoice amount to

encourage prompt payment on sales.

Sales discount

Credit allowed a customer for the sales price of returned

merchandise, resulting in a decrease in the vendor’s accounts

receivable.

Sales return

A form signed by a buyer at the time of a sale of merchandise

in which the buyer promises to pay the seller a specified sum of money, usually at a stated

time in the future.

Trade acceptance

A receipt signed by the authorized agent of a

transportation company for merchandise received that also

serves as a contract for the delivery of the merchandise.

Bill of Lading

Goods or services shipped out of a seller’s home country to a

foreign country.

exports

A letter issued by a bank guaranteeing that a named

individual or business will be paid a specified amount provided

stated conditions are met.

Letter of credit

A written, signed, and dated order from one party ordering

another party, usually a bank, to pay money to a third party.

draft

When recording an international cash sale, these accounts are

affected in this way and recorded in this journal.

Cash – DebitSales – CreditCash Receipts

When receiving a time draft for an international sale, these accounts are affected and recorded in this journal.

Time Drafts Receivable – DebitSales Credit

General Journal

The three columns in the sales journal.

Accounts Receivable DebitSales Credit

Sales Tax Payable Credit

The source document for a sale on account.

Sales Invoice

The accounting concept that states: regardless of when cash is

received, revenue should be recorded when merchandise is

sold.

Realization of Revenue

A business owes the sales taxes collected to this.

State Government

When organizations like schools do not have to pay sales tax, they

are said to be this.

Exempt

When recording cash and credit card sales, this is placed in the

account title column.

Check Mark

The source document used when recording cash and credit card

sales.

Cash Register Tape

The amount to place in the sales tax payable debit column in the transaction receiving cash on account from Ten Company, $1924.76, covering S176 for

$1944.00 ($1,800 plus sales tax, $144), less 1% discount and sales

tax, Receipt 297.

$1.44

A contra account to sales

Sales Discount

A deduction on the invoice amount is given for this reason.

To encourage early payment

The original copy of a credit memorandum is given to the

customer. The second copy is used as the source document.

This concept is applied.

Objective Evidence

The normal balance of the Sales Returns and Allowances account.

Debit

The best order to post from the journals.

Sales JournalPurchases JournalGeneral Journal

Cash Receipts JournalCash Payments Journal

A listing of customer accounts, account balances, and total

amount due from all customers.

Schedule of Accounts Receivable

Business transactions are stated in numbers that have common

values.

UNIT OF MEASUREMENT