The Collection of a ¥9,000 Account After the 2 Percent

question 180

Multiple Choice

The collection of a ¥9,000 account after the 2 percent discount period will result in a

• A) debit to Cash for ¥8,820.
• B) credit to Accounts Receivable for ¥9,000.
• C) credit to Cash for ¥9,000.
• D) debit to Sales Discounts for ¥180.

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Definitions:

Office Salaries Expense

The costs associated with paying salaries to administrative and office employees.

Indirect Expense

Expenses incurred that are not directly linked to a specific product or service, such as utilities or rent for the business premises.

Service Department Charges

The costs of services provided by an internal service department and transferred to a responsibility center.

Profit Center

A branch or division of a business that is directly responsible for generating its own revenue and profits.