Day: September 16, 2018

A newsagent’s total sales will normally include the value of the following items?

Select ONE answer:

1. Any office furniture that is sold by them.
2. Any office furniture sold by them, but only if these items are sold on credit.
3. Any office furniture sold by them, but only if these items are sold for cash.
4. None of the above.

Explain what is meant by selling a good on credit?:

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This multiple choice question is suitable for Accounting KS5 classes.

The answer is 4 – In accounting, the meaning of the term “sales” is limited to the sale of goods originally acquired for the purpose of being resold whether this is for cash or credit. In the case of a newsagent, it is highly unlikely that office furniture would have been acquired for the purpose of being resold in the normal course of business.

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