Accounts payable ledger (p. 248)
A subsidiary ledger that contains a separate account for each creditor.
Cash discount (p. 243)
A discount offered by suppliers for payment received within a specific period of time.
Cost of goods sold (p. 240)
The actual cost to the business of merchandise sold to customers.
“Freight In” account (p. 241)
An account showing transportation charges for items purchased.
Purchase allowance (p. 242)
A price reduction from the amount originally billed.
Purchase invoice (p. 238)
A bill received for goods purchased.
Purchase order (p. 238)
An order to the supplier of goods specifying items needed, quantity, price, and credit terms.
Purchase requisition (p. 238)
A list sent to the purchasing department showing the items to be ordered.
Purchase return (p. 241)
Return of unsatisfactory goods.
“Purchases” account (p. 240)
An account used to record cost of goods bought for resale during a period.
Purchases discount (p. 243)
A cash discount offered to customers for payment within a specified period.
“Purchases Returns and Allowances” (p. 242)
A contra expense under cost of goods sold where purchase returns and purchase allowances are recorded; see definitions of “purchase return and purchase allowance.”
Receiving report (p. 238)
A form showing quantity and condition of goods received.
Sales discount (p. 243)
A cash discount offered by the supplier for payment within a specified period.
Sales invoice (p. 238)
A supplier’s billing document.
Schedule of accounts payable (p. 249)
A list of all balances owed to creditors.
“Transportation In” account (p. 241)
See “Freight In” account.
