Examkin

Question

Difficulty: EasyNature, Features, and Terminology of Consignment Transactions

Chief Emeka dispatched goods to Kwame to be sold on his behalf on a consignment basis. At the end of the trading period, Kwame sent a statement detailing the gross sales realized, expenses incurred, commission earned, and net balance due to Chief Emeka. Which document was prepared and sent by Kwame?

  1. A
    Proforma Invoice
  2. Account SalesAnswer
  3. C
    Sales Invoice
  4. D
    Debit Note

Answer

Account Sales
An Account Sales is the standard document prepared by the consignee (agent) and submitted to the consignor (principal) showing full particulars of goods sold, expenses incurred, commission deducted, and the net balance owed.

Step-by-Step Solution

1
Identify the sender and recipient of the document in the scenario
The document is prepared and sent by the agent (consignee) to the principal (consignor).
Understanding who issues the document is critical for identifying consignment terminology.
2
Analyze the purpose and contents of the statement
The statement summarizes sales proceeds, expenses, commission, and net amount remitted.
This specific summary function defines the Account Sales statement in consignment transactions.

Key Concept

Account Sales Terminology
Rate this question

Topics

Nature, Features, and Terminology of Consignment Transactions

More questions from this topic