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Chapter 9: Vocab
Vocabulary terms for Chapter 9: Merchandising Business Organized as a Corporation
29
Accounting
11th Grade
01/09/2015

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Term
Merchandise
Definition
Goods that a merchandising business purchases to sell.
Term
Merchandising Business
Definition
A business that purchases and sells goods.
Term
Retail Merchandising Business
Definition
A merchandising business that sells to those who use or consume the goods.
Term
Wholesale Merchandising Business
Definition
A business that buys and resells merchandise to retail merchandising businesses.
Term
Corporation
Definition
An organization with the legal rights of a person and which may be owned by many persons.
Term
Share of Stock
Definition
Each unit of ownership in a corporation.
Term
Capital Stock
Definition
Total shares of ownership in a corporation.
Term
Stockholder
Definition
An owner of one or more shares of a corporation.
Term
Special Journal
Definition
A journal used to record only one kind of transaction.
Term
Cost of Merchandise
Definition
The price a business pays for goods it purchases to sell.
Term
Markup
Definition
The amount added to the cost of merchandise to establish the selling price.
Term
Vendor
Definition
A business from which merchandise is purchased or supplies or other assets are bought.
Term
Purchase on Account
Definition
A transaction in which the merchandise purchased is to be paid for later.
Term
Purchases Journal
Definition
A special journal used to record only purchases of merchandise on account.
Term
Special Amount Column
Definition
A business paper from which information is obtained for a journal entry.
Term
Purchase Invoice
Definition
An invoice used as a source document for recording a purchase on account transaction.
Term
Terms of Sale
Definition
An agreement between a buyer and a seller about payment for merchandise.
Term
Cash Payments Journal
Definition
A special journal used to record only cash payment transactions.
Term
Cash Discount
Definition
A deduction from the invoice amount, allowed by a vendor to encourage early payment.
Term
Purchases Discount
Definition
A cash discount on purchases taken by a customer.
Term
General Amount Column
Definition
A journal amount column that is not headed with an account title.
Term
List Price
Definition
The retail price listed in a catalog or on an Internet site.
Term
Trade Discount
Definition
A reduction in the list price granted to customers.
Term
Contra Account
Definition
An account that reduces a related account on a financial statement.
Term
Cash Short
Definition
A petty cash on hand amount that is less than a recorded amount.
Term
Cash Over
Definition
A petty cash on hand amount that is more than a recorded amount.
Term
Purchases Return
Definition
Credit allowed for the purchase price of returned merchandise, resulting in a decrease in the customer's accounts payable.
Term
Purchases Allowance
Definition
Credit allowed for part of the purchase price of merchandise that is not returned, resulting in a decrease in the customer's accounts payable.
Term
Debit Memorandum
Definition
A form prepared by the customer showing the price deduction taken by the customer for returns and allowances.
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