Which of the Following Accounts Is Used for Recording Merchandise

question 43

Multiple Choice

Which of the following accounts is used for recording merchandise for resale?

• A)Purchases
• B)Purchase Discounts
• C)Purchase Discounts Lost
• D)Sales

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Definitions:

Regressive Tax

At the individual level, a tax whose average tax rate decreases as the taxpayer’s income increases. At the national level, a tax for which the average tax rate (= tax revenue/GDP) falls as GDP rises.

Income Tax Base

The total amount of income on which an individual or entity is required to pay income tax.

Sales Tax

A tax levied on the cost (at retail) of a broad group of products.

Federal Income Tax

The tax levied by the IRS on the annual earnings of individuals, corporations, trusts, and other legal entities.