On a Common-Size Statement of fiNancial Position, All _____ Accounts

question 283

Multiple Choice

On a common-size statement of financial position, all _____ accounts are shown as a percentage of _____.

• A) Income; total assets.
• B) Liability; net income.
• C) Asset; sales.
• D) Liability; total assets.
• E) Equity; sales.

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Definitions:

Perpetual Inventory Method

The perpetual inventory method is a system of accounting for inventory that continuously updates the quantity and value of inventory items after every transaction.

Journalize

The act of recording transactions in the accounting journals as part of the bookkeeping process.

Terms 2/10, N/30

Payment terms indicating a 2% discount if paid within 10 days, otherwise the net amount (total invoice) is due within 30 days.

Debit Memorandum

A document issued by a buyer to a seller indicating a debit made to the seller's account, often due to returned goods or errors in the invoice.