Future Business Leaders of America (FBLA) Accounting Practice Test

What term describes a form that describes goods or services sold, including quantity and price?

1. Sales Invoice

2. Receipt

3. Memo

4. Source Document

The correct answer is: Sales Invoice

A sales invoice is a crucial document in accounting that details the transaction between a buyer and a seller. It includes essential information such as the goods or services provided, their quantities, and the corresponding prices. This form serves multiple purposes: it acts as a request for payment, provides a record for both the seller and buyer, and is used for tracking sales and inventory. When a business sells goods or services, it issues a sales invoice to inform the customer of what has been purchased and the total amount due. This document is important for maintaining accurate financial records, as it not only reflects sales revenue but also facilitates proof of sale for accounting and auditing purposes. The other options, while related to financial transactions, do not specifically encompass all the key elements described in the question: - A receipt confirms the payment made but does not itemize the goods sold in detail. - A memo serves more as a communication tool rather than a record of transactions involving quantities and prices. - A source document is a broader term that refers to any original record that contains the details of a financial transaction, but does not specifically refer to the invoice format that summarizes sales in detail. Thus, the sales invoice is the correct term that accurately describes the form indicating goods or services sold, including