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The acid-test ratio is also called the quick ratio.

On September 12, Vander Company sold merchandise in the amount of $5,800 to Jepson Company, with credit terms of 2/10, n/30. The cost of the items sold is $4,000. Vander uses the periodic inventory system and the gross method of accounting for sales. Jepson pays the invoice on September 18, and takes the appropriate discount. The journal entry that Vander makes on September 18 is:

A company borrowed $10,000 by signing a six-month promissory note at 5% interest. The amount of interest to be paid at maturity is $25.

The voucher system of control:

Sales discounts has a normal debit balance because it decreases Sales, which has a normal credit balance.

A retailer buys products from manufacturers and sells them to wholesalers.

Most large thefts occur from payment of fictitious invoices, which makes control of cash disbursements especially important for companies.

The voucher system of control:

Credit terms for a purchase include the amounts and timing of payments from a buyer to a seller.

Most large thefts occur from payment of fictitious invoices, which makes control of cash disbursements especially important for companies.