CMA Foundation · Fundamentals of Financial and Cost Accounting · Consignment
In the books of the consignor, which of the following correctly describes the nature of the account sent by the consignee to the consignor periodically, showing sales, expenses incurred and commission charged?
The statement is called Account Sales. The consignee prepares it for the consignor, showing sales made, expenses incurred, commission charged and the net balance payable or remitted. A proforma invoice is different, because the consignor sends it with the goods.
- AAccount SalesCorrect
- BProforma Invoice
- CDebit Note
- DMemorandum Trial Balance
Explanation
The consignee periodically sends an Account Sales to the consignor, showing goods sold, expenses incurred, commission deducted and the net amount due or remitted. A proforma invoice is sent by the consignor along with the goods and is not a statement of sales.
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