Kế toán, kiểm toán - Chapter fourteen: Accounting for sales

CHAPTER FOURTEENACCOUNTING FOR SALES 1. Record the entries for the sale of merchandise for cash or on credit. 2. Record sales discounts. 3. Record the entries for sales returns and allowances. 4. Record sales tax.ACCOUNTING FOR SALESObjectives:3Recording Sales of MerchandiseSales of merchandise are recorded in a revenue account called Sales. The amount of each sale of merchandise is credit to Sales. The offsetting debit is to Cash or Accounts Receivable.4Transaction$760 worth of merchandise was sold for cash.5Transaction AnalysisCash is debited $760.Sales is credited $760. 6Transaction$300 worth of merchandise was sold on credit. 7Transaction AnalysisDebit Accounts Receivable $300.Credit Sales in the amount $300. 8Recording Amounts Received From Sales of Merchandise on CreditIf the cash discount is taken three accounts are affected: Cash, Sales Discount and Account Receivable.9Transaction$291 was received for the payment of an Accounts Receivable. The sales discount is $9, ($300 x 0.03). 10Transaction AnalysisCash is debited in the amount of $291.Sales Discount is debited in the amount of $9.Accounts receivable is credited in the full amount of $300. 11Transaction Analysis (continued)12Recording Sales Returns and AllowancesWhen a customer returns merchandise or receives an allowance, there is a decrease in revenue.This decrease is recorded by debiting the revenue account, Sales Returns and Allowances, and crediting either Cash or Accounts Receivable.13Recording Sales Returns and Allowances (continued) Many businesses provide a cash refund if customers return merchandise or ask for an allowance on goods sold for cash.Sales Returns and Allowances account is debited.Cash is credited.14Recording Sales TaxWhen a sales slip or invoice includes sales tax, the tax is collected from the customer and either Cash or Accounts Receivable is debited.Because the sales tax is owed to the state or city taxing authority, it is credited to a liability account called Sales Tax Payable.15Sales Returns and Allowances and Sales TaxCustomers who return merchandise or receive an allowance from retail businesses that charge sales tax must be given a refund for the price of the goods plus the sales tax.16Accounting TerminologyCredit salesMerchandise inventorySales discountSales returns and allowancesSales tax17Chapter SummarySales of merchandise are credited to a revenue account called Sales.When a customer deducts a cash discount, the amount is debited to the Sales Discount account.18Chapter Summary (continued)The Sales Returns and Allowances account is used to record the decrease in sales revenue that results when a customer returns merchandise or receives an allowance. This account is debited for all returns and allowances. Either Cash or Accounts Receivable is credited.19Chapter Summary (continued)States and cities may impose a sales tax. The retailer collects this tax from customers.When sales are made, the amount of sales tax is credited to the liability account Sales Tax Payable.20Chapter Summary (continued)If a refund or a credit for a sales return or allowance involves sales tax, Sales Tax Payable is debited for the amount of the tax and Sales Returns and Allowances is debited for the amount of the return or allowance.21 Investigating on the InternetAs a research assignment, access the web site for Wal*Mart® and report the sources of information that might concern sales of merchandise.221. Sales of merchandise are credited to a revenue account called Sales.2. Sales tax is normally credited to an account called Sales Tax Payable 3. Sales Returns and Allowances is usually credited when a customer returns goods or receives an allowance.Topic QuizAnswer the following true/false questions:TRUEFALSETRUE23(Return to Topic Quiz)3. Sales Returns and Allowances is usually credited when a customer returns goods or receives an allowance.FALSESales Returns and Allowances is usually debited when a customer returns goods or receives an allowance, thus reducing revenue.24