If the statement is true, write T in the space provided. If the statement is false, write F in the space provided.
1. Accounts in the chart of accounts that show the cost or price of merchandise purchased for resale to customers are called cost of merchandise accounts.
2. An account used to record the cost of the merchandise purchased for resale is called the resale account.
3. A departmentalized system uses a separate merchandise inventory account for each department.
4. A departmentalized system uses a separate accounts payable account for each department.
5. A purchases return transaction is entered in the cash payments window.
6. A sales return transaction is entered in the cash receipts window.
7. The appropriate general ledger account number must be keyed for each department when entering purchase order, purchase invoice, and sales invoice transactions.
8. When a cash payment on account transaction involves a discount, the discount amount is entered into the appropriate department’s purchases discounts account.
9. When a cash receipt on account transaction involves a discount, the discount amount is entered into the appropriate department’s sales discounts account.
10. When the gross profit statements option is chosen, a separate report is generated for each department.