Chapter 3: Accounting for sales & sales returns Flashcards Preview

AAT (L2): FINAL Chapter Summary > Chapter 3: Accounting for sales & sales returns > Flashcards

Flashcards in Chapter 3: Accounting for sales & sales returns Deck (22)
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1

What specific stages of recording & presenting financial transactions does the accounting system contain?

-Financial Documents
-Books of Prime entry
-Double Entry Book-Keeping
-Trial Balance

2

The financial documents relating to credit sales are

-Sales invoices
-Credit notes issued

3

What is the sales day book prepared from?

From Credit notes to customers.

4

What is the sales day book for credit sales?

The book of prime entry.

5

Recording credit sales in the double-entry system uses?

Financial Documents: Sales Invoices
Books of Prime Entry: Sales Day Books
Double-Entry Accounts: General Ledger
Memorandum Acounts: Sales Ledger

6

Analysed Sales & Sales Returns day books are used when?

When a business wishes to analyse it's sales between different departments or

Different categories of goods sold / services supplied.

7

Financial Documents?

Source Documents for the accounting records

8

Books of prime entry?

The first accounting books in which transactions are recorded

9

Coding?

Cross-referencing methods used to trace transactions through the accounting system

10

Ledger?

Collection of accounts within the accounting system

11

Debit entry?

Records a gain in value

an asset

or an expense

12

Credit entry?

Records the giving of value

a liability

or an income item

13

Sales?

The sale of goods in which the business trades

14

Capital Income?

Income from items other than than the goods in which the business trades

(eg. a shop selling its old cash till)

15

Revenue income?

Income from the goods in which the business trades

16

Sales returns?

Goods previously sold on credit which are returned to the business by its customers

17

Sales returns day book?

Book of prime entry prepared from sales invoices

18

Sales returns day book?

Book of prime entry

prepared from credit notes issued to customers

19

Analysed sales day book?

Day books which incorporate analysis columns

(eg. between different departments


or

Different categories of goods / services sold)

20

General Ledger

Ledger section which includes

Sales account
Sales returns account
Sales ledger control account
VAT account

21

Sales Ledger

Subsidiary ledger section which contains the memorandum accounts of the firm's receivables (customers)

22

Memorandum account?

A subsidiary ledger
(eg sales ledger)

account which provides a record of individual amounts
(eg owing by receivables to the business)