The Accounting Cycle for a Merchandising Corporation
WebQuest Internet Project
In this project, students will explore what it takes to run an online retail store. They will investigate the current trends in online shopping and offer an oral presentation that includes information on what elements an online store should include, how security issues should be handled, and how payment processing works. They will research shopping cart technologies and find out how online transactions can be integrated with computerized accounting systems.
The Guidance section of this WebQuest project contains questions that would be applicable for a whole-class discussion and for generating interdisciplinary connections. If you prefer, have each student research only one of the questions and add the information he or she finds to the final presentation of their WebQuest.
Several Web sites are included in the project to help students complete the WebQuest project. Encourage students to find additional sites and to share those sites with other students.
- Bankcard sales are handled like cash sales. They are posted to the cash receipts journal with a debit to Cash and a credit to Sales and Sales Tax Payable.
- In a manual accounting system, the Merchandise Inventory account and the Income Summary account are affected when adjusting Merchandise Inventory after a physical inventory count.
- Grocer.com experienced net income for the period.
- Watches.com would record a debit to Accounts Receivable (and to your subsidiary account) of $27, a credit to Sales for $25, and a credit to Sales Tax Payable for $2.
- When a customer uses a bankcard like VISA or Mastercard for a purchase, the business treats this transaction like a cash transaction.
- Never respond to an email asking for donations or to purchase items. Contact the company directly.
- If online transactions were to update general ledger accounts automatically, the Sales, Sales Tax Payable, and Cash accounts would be affected.
- Net income has increased by 7% due to the website launch.
- A company should have adequate cash available and be authorized to declare dividends by its board of directors.