All credit sales of merchandise are recorded in which book?

Sales book

The correct answer is option 4- Sales book.

All credit sales of merchandise are recorded in the sales journal. Cash sales are recorded in the cash book. The format of the sales journal is similar to that of the purchases journal. The source document for recording entries in the sales journal are sales invoice or bill issued by the firm to the customers. The date of sale, invoice number, name of the customer and amount of the invoice are recorded in the sales journal. Other details about the sales transaction including terms of payment are available in the invoice. In fact, two or more than two copies of a sales invoice are prepared for each sale.

OTHER OPTIONS-

• Cash book- A book used to record all cash receipts and payments.

• Return outwards book-  A book in which return of merchandise purchased is recorded.

• Return inwards book- A special book in which returns of merchandise sold on credit are recorded.