Question 1

A debit column for Sales Returns and Allowances may be found in the cash payments journal.

Accepted Answer

A) True 
 B)False

Question 2

Transaction amounts recorded in the general journal are never posted to accounts in the subsidiary ledger.

Accepted Answer

A) True 
 B)False

Question 3

Postings are generally made more frequently to the general ledger control accounts than to the individual accounts in the subsidiary ledgers.

Accepted Answer

A) True 
 B)False

Question 4

For each transaction indicate by the code letter the appropriate journal where the transaction would be journalized.

Accepted Answer

The answer of   
For each transaction indicate by...

Question 5

Match between columns
                        Premises: Information must be understandable, relevant, reliable, timely, and accurate.
Benefits of information must outweigh the cost of providing it.
The system should accommodate a variety of users and changing information needs.
The accounting system must consider the needs and knowledge of various users.
The system should be capable of meeting the changes in the demands made upon it.

Accepted Answer

The Answer of Cost effectiveness and Flexibility and Useful output is...

Question 6

Totaling the columns of a journal and proving the equality of the totals is called footing and cross-footing a journal.

Accepted Answer

A) True 
 B)False

Question 7

The entries in a sales journal will show

Accepted Answer

A)  all sales of merchandise. 
B)  the cash sales of the company. 
C)  the credit sales of merchandise. 
D)  all sales of the company. 
A)  all sales of merchandise. 
B)  the cash sales of the company. 
C)  the credit sales of merchandise. 
D)  all sales of the company.

Question 8

The individual amounts in the Accounts Payable column in the cash payments journal are posted to the subsidiary ledger

Accepted Answer

A)  daily. 
B)  monthly. 
C)  weekly. 
D)  yearly. 
A)  daily. 
B)  monthly. 
C)  weekly. 
D)  yearly.

Question 9

The balance of a control account in the general ledger

Accepted Answer

A)  must always be zero. 
B)  must equal the amount of total assets. 
C)  is always greater than the composite balance of individual accounts in a related subsidiary ledger. 
D)  must equal the composite balance of individual accounts in a related subsidiary ledger. 
A)  must always be zero. 
B)  must equal the amount of total assets. 
C)  is always greater than the composite balance of individual accounts in a related subsidiary ledger. 
D)  must equal the composite balance of individual accounts in a related subsidiary ledger.

Question 10

Devotchka Co. uses special journals and a general journal. The following transactions occurred during May 2016.
May 1 Z. Devotchka invested $25000 cash in the business.
2 Sold merchandise to A. A. Bondy for $5600 cash. The cost of the merchandise sold
was $3500.
3 Purchased merchandise for $4300 from Y. Vandyver using check no. 101.
14 Paid salary to D. Dilego $1200 by issuing check no. 102.
16 Sold merchandise on account to S. Stevens for $840 terms n/30. The cost of the
merchandise sold was $500.
22 A check of $7200 is received from S. Sufjan in full for invoice 101; no discount given.
Instructions
(a) Prepare a multiple-column cash receipts journal and a multiple-column cash payments journal. (Use page 1 for each journal.)
(b) Record the transaction(s) for May that should be journalized in the cash receipts journal and cash payments journal.

Accepted Answer

The answer of Devotchka Co. uses special journals and a...

Question 11

Which of the following statements is incorrect?

Accepted Answer

A)  A major consideration in developing an accounting system is cost effectiveness. 
B)  When an accounting system is designed no consideration needs to be given to the needs and knowledge of the various users. 
C)  The accounting system should be able to accommodate a variety of users and changing information needs. 
D)  To be useful information must be understandable relevant reliable timely and accurate. 
A)  A major consideration in developing an accounting system is cost effectiveness. 
B)  When an accounting system is designed no consideration needs to be given to the needs and knowledge of the various users. 
C)  The accounting system should be able to accommodate a variety of users and changing information needs. 
D)  To be useful information must be understandable relevant reliable timely and accurate.

Question 12

A subsidiary ledger provides up-to-date information on specific account balances.

Accepted Answer

A) True 
 B)False

Question 13

All of the following are advantages of using subsidiary ledgers except they

Accepted Answer

A)  eliminate errors in individual accounts. 
B)  free the general ledger of excessive details. 
C)  show in a single account transactions affecting one customer or one creditor. 
D)  make possible a division of labor. 
A)  eliminate errors in individual accounts. 
B)  free the general ledger of excessive details. 
C)  show in a single account transactions affecting one customer or one creditor. 
D)  make possible a division of labor.

Question 14

Hawk Company uses a single-column purchases journal a cash payments journal and a general journal to record transactions with its suppliers and others. Record the following transactions in the appropriate journals.
Transactions
Oct. 5 Purchased merchandise on account for $19000 from Harrelson Company. Terms: 2/10 n/30; FOB shipping point.
Oct. 6 Paid $6600 to Ken's Insurance Company for a two-year fire insurance policy.
Oct. 8 Purchased store supplies on account for $600 from Stone Pony Supply Company. Terms: 2/10 n/30.
Oct. 11 Purchased merchandise on account for $15000 from Steve Corporation. Terms: 2/10 n/30; FOB shipping point.
Oct. 13 Granted a reduction of $3000 from Steve Corporation for merchandise purchased on October 11 and returned because of damage.
Oct. 15 Paid Harrelson Company for merchandise purchased on October 5 less discount.
Oct. 16 Purchased merchandise for $9000 cash from Williams Company.
Oct. 21 Paid Steve Corporation for merchandise purchased on October 11 less merchandise returned on October 13 less discount.
Oct. 25 Purchased merchandise on account for $21000 from Ozzle Company. Terms: 2/10 n/30; FOB shipping point.
Oct. 31 Purchased equipment for $27000 cash from Guillen Office Supply Company.

Accepted Answer

None

Question 15

In which journal would a customer's partial payment on account be recorded?

Accepted Answer

A)  Sales journal 
B)  Cash receipts journal 
C)  General journal 
D)  Cash payments journal 
A)  Sales journal 
B)  Cash receipts journal 
C)  General journal 
D)  Cash payments journal

Question 16

If a transaction cannot be recorded in a special journal it is

Accepted Answer

A)  not recorded. 
B)  a correcting entry. 
C)  recorded in the general journal. 
D)  an error. 
A)  not recorded. 
B)  a correcting entry. 
C)  recorded in the general journal. 
D)  an error.

Question 17

Control accounts are always located in the general ledger.

Accepted Answer

A) True 
 B)False

Question 18

The composite balance of individual accounts in the accounts payable subsidiary ledger must

Accepted Answer

A)  equal the composite balance of the individual accounts in the accounts receivable subsidiary ledger. 
B)  always be zero. 
C)  equal the balance of the accounts payable account in the general ledger. 
D)  agree with the total of the Accounts payable column in the cash receipt journal. 
A)  equal the composite balance of the individual accounts in the accounts receivable subsidiary ledger. 
B)  always be zero. 
C)  equal the balance of the accounts payable account in the general ledger. 
D)  agree with the total of the Accounts payable column in the cash receipt journal.

Question 19

A sales journal is used to record

Accepted Answer

A)  only cash sales of merchandise. 
B)  sales of all assets on credit and for cash. 
C)  only credit sales of merchandise. 
D)  credit sales of merchandise sales returns and allowances and sales discounts. 
A)  only cash sales of merchandise. 
B)  sales of all assets on credit and for cash. 
C)  only credit sales of merchandise. 
D)  credit sales of merchandise sales returns and allowances and sales discounts.

Question 20

The use of special journals to record transactions

Accepted Answer

A)  eliminates the need for a general ledger. 
B)  can save time in the posting process. 
C)  eliminates the need for a general journal. 
D)  should only be used if the volume of transactions is small. 
A)  eliminates the need for a general ledger. 
B)  can save time in the posting process. 
C)  eliminates the need for a general journal. 
D)  should only be used if the volume of transactions is small.

Exam 7: Accounting Information Systems

A debit column for Sales Returns and Allowances may be found in the cash payments journal.

Transaction amounts recorded in the general journal are never posted to accounts in the subsidiary ledger.

Postings are generally made more frequently to the general ledger control accounts than to the individual accounts in the subsidiary ledgers.

For each transaction indicate by the code letter the appropriate journal where the transaction would be journalized.

Totaling the columns of a journal and proving the equality of the totals is called footing and cross-footing a journal.

The entries in a sales journal will show

The individual amounts in the Accounts Payable column in the cash payments journal are posted to the subsidiary ledger

The balance of a control account in the general ledger

Which of the following statements is incorrect?

A subsidiary ledger provides up-to-date information on specific account balances.

All of the following are advantages of using subsidiary ledgers except they

In which journal would a customer's partial payment on account be recorded?

If a transaction cannot be recorded in a special journal it is

Control accounts are always located in the general ledger.

The composite balance of individual accounts in the accounts payable subsidiary ledger must

A sales journal is used to record

The use of special journals to record transactions

Accounting in Action

The Recording Process

Adjusting the Accounts

Completing the Accounting Cycle

Accounting for Merchandising Operations

Inventories

Fraud, Internal Control, and Cash

Accounting for Receivables

Plant Assets, Natural Resources, and Intangible Assets

Current Liabilities and Payroll Accounting

Accounting for Partnerships

Corporations: Organization and Capital Stock Transactions

Corporations: Dividends, Retained Earnings, and Income Reporting

Long-Term Liabilities

Investments

Statement of Cash Flows

Financial Statement Analysis

Managerial Accounting

Job Order Costing

Process Costing

Cost-Volume-Profit

Budgetary Planning

Budgetary Control and Responsibility Accounting

Standard Costs and Balanced Scorecard

Incremental Analysis and Capital Budgeting

Time Value of Money

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