Merchandising businesses follow an orderly process for purchasing merchandise, supplies, and equipment.

The accounting department is responsible for making the cash payments for the business. Individual accounts payable transactions are posted to a subsidiary ledger.

• Explain the procedures for processing a purchase on account.

• Describe the accounts used in the purchasing accounts.

• Analyze transactions relating to the purchase of merchandise.

• Record a variety of purchases and cash payments.

• Post to the accounts payable subsidiary ledger.

• Identify controls over cash.