Explain the recording of Sales Revenue under the Perpetual and Periodic inventory system including Sales Returns & Allowances.
Create and set-up the customers’ accounts with the terms of sales using QuickBooks.
Explain the concept of writing off bad debts under the Allowance Method and Direct Write-off Method in manual accounting.
Determine the journal entries for taxable sales items and explain the method used in actual practice to facilitate the recording process without the necessary adjusting entries.
Continuing the discussion for the accounting of a merchandising company, the previous two chapters have focused on acquiring the inventory on account (Chapter 6), and the cash payments procedures (Chapter 7). Using QuickBooks Pro, the selling price of the Inventory has also been established and set-up of sales tax rate where applicable on Chapter 6. The seller transfers title of the inventory to the buyer in exchange for cash or a promise to pay at a future date. In as much as most retail companies prefer cash sales, selling on account or on credit will help increase the volume of sales.