Question 1

To record the payment of a purchase invoice when a cash discount is taken, the accountant would:

Accepted Answer

A) debit Accounts Payable and credit Cash. 
B) debit Accounts Payable, credit Purchases Discounts, and credit Cash. 
C) debit Purchases, credit Purchases Discounts, and credit Cash. 
D) debit Accounts Payable, debit Purchases Discounts, and credit Cash. 
A) debit Accounts Payable and credit Cash. 
B) debit Accounts Payable, credit Purchases Discounts, and credit Cash. 
C) debit Purchases, credit Purchases Discounts, and credit Cash. 
D) debit Accounts Payable, debit Purchases Discounts, and credit Cash.

Question 2

The process of determining why a difference exists between a firm's records and the bank's records and bringing the two sets of records into balance is known as ________ the bank statement.

Accepted Answer

The answer of The process of determining why a difference...

Question 3

Record the following transactions for the month of November 2019 on page 8 of a cash receipts journal. Total, prove, and rule the cash receipts journal as of November 30.
Nov. 1 Collected $3,600 from Katie Bing, a credit customer on account.
10 Received a check from Mike Drake to pay his $5,600 promissory note plus interest of $336.
13 Received $6,400 from Jessie Cole, a credit customer, in payment of her account.
15 Had cash sales of $18,000 plus sales tax of $1,260. There was a cash overage of $5.

Accepted Answer

The answer of Record the following transactions for the month...

Question 4

Hawthorne Inc. uses the perpetual inventory system when recording its cash payments and cash receipts. If the company issues a check to pay for goods purchased and they pay within the discount period, identify the account used to record the discount.

Accepted Answer

A) merchandise inventory 
B) purchases 
C) sales discounts 
D) purchases discounts 
A) merchandise inventory 
B) purchases 
C) sales discounts 
D) purchases discounts

Question 5

Which of the following statements is NOT correct regarding the cash receipts journal?

Accepted Answer

A) The amounts recorded in the Accounts Receivable Credit column are posted daily to individual accounts in the accounts receivable subsidiary ledger. 
B) The amounts that appear in the Other Accounts Credit column are posted individually to the general ledger accounts during the month. 
C) After posting a column total from the cash receipts journal to a general ledger account, a (--)is entered at the bottom of the journal column. 
D) Before any posting to the general ledger takes place, the equality of the debits and credits recorded in the cash receipts journal are proved. 
A) The amounts recorded in the Accounts Receivable Credit column are posted daily to individual accounts in the accounts receivable subsidiary ledger. 
B) The amounts that appear in the Other Accounts Credit column are posted individually to the general ledger accounts during the month. 
C) After posting a column total from the cash receipts journal to a general ledger account, a (--)is entered at the bottom of the journal column. 
D) Before any posting to the general ledger takes place, the equality of the debits and credits recorded in the cash receipts journal are proved.

Question 6

On March 31, 2019, Home Decorating Pavilion received a bank statement with an ending balance of $9,750. The balance in the firm's checkbook and Cash account on the same date was $10,290. The difference between the two balances is caused by the items listed below.
-A $2,875 deposit made on March 30 does not appear on the bank statement.
-Check 358 for $485 issued on March 29 and Check 359 for $1,650 issued on March 30 have not yet been paid by the bank.
-A credit memorandum shows that the bank has collected a $1,100 note receivable and interest of $110 for the firm.
-A service charge of $25 appears on the bank statement.
-A debit memorandum shows an NSF check for $525. (The check was issued by Dane Smithey, a credit customer.)
-The firm's records indicate that Check 341 of March 1 was issued for $900 to pay the month's rent. However, the canceled check and the listing on the bank statement show that the actual amount of the check was $800.
-The bank made an error by deducting a check for $560 issued by another business from the balance of Home Decorating Pavilion's account.
Instructions:
1. Prepare a bank reconciliation statement for the firm as of March 31, 2019.
2. Record entries for any items on the bank reconciliation statement that must be journalized. Date the entries March 31, 2019. Use page 4 of a general journal.

Accepted Answer

The answer of On March 31, 2019, Home Decorating Pavilion...

Question 7

The entry to record an additional cash investment by the owner is recorded in:

Accepted Answer

A) the purchases journal. 
B) the cash payments journal. 
C) the cash receipts journal. 
D) the general journal. 
A) the purchases journal. 
B) the cash payments journal. 
C) the cash receipts journal. 
D) the general journal.

Question 8

A firm's bank reconciliation statement shows a book balance of $16,640, a non-interest note collected by the bank of $3,400 an NSF check of $1,650, and a service charge of $60. Its adjusted book balance is:

Accepted Answer

A) $14,950. 
B) $21,750. 
C) $18,330. 
D) $14,930. 
A) $14,950. 
B) $21,750. 
C) $18,330. 
D) $14,930.

Question 9

Purchases Discounts is a contra cost of goods sold account.

Accepted Answer

A) True 
 B)False

Question 10

Identify the procedure below that is NOT essential for proper control over cash payments.

Accepted Answer

A) Make all payments out of a petty cash fund or a travel and entertainment fund. 
B) Use prenumbered checks. 
C) Enter all cash payments promptly in the accounting records. 
D) Have only designated personnel approve bills and invoices before they are paid. 
A) Make all payments out of a petty cash fund or a travel and entertainment fund. 
B) Use prenumbered checks. 
C) Enter all cash payments promptly in the accounting records. 
D) Have only designated personnel approve bills and invoices before they are paid.

Question 11

To arrive at an accurate balance on a bank reconciliation statement, a service charge should be:

Accepted Answer

A) added to the bank statement balance. 
B) deducted from the bank statement balance. 
C) added to the book balance. 
D) deducted from the book balance. 
A) added to the bank statement balance. 
B) deducted from the bank statement balance. 
C) added to the book balance. 
D) deducted from the book balance.

Question 12

Grouping all transactions involving cash payments together in the cash payments journal strengthens the audit trail.

Accepted Answer

A) True 
 B)False

To record the payment of a purchase invoice when a cash discount is taken, the accountant would:

The process of determining why a difference exists between a firm's records and the bank's records and bringing the two sets of records into balance is known as ________ the bank statement.

Hawthorne Inc. uses the perpetual inventory system when recording its cash payments and cash receipts. If the company issues a check to pay for goods purchased and they pay within the discount period, identify the account used to record the discount.

Which of the following statements is NOT correct regarding the cash receipts journal?

The entry to record an additional cash investment by the owner is recorded in:

A firm's bank reconciliation statement shows a book balance of $16,640, a non-interest note collected by the bank of $3,400 an NSF check of $1,650, and a service charge of $60. Its adjusted book balance is:

Purchases Discounts is a contra cost of goods sold account.

Identify the procedure below that is NOT essential for proper control over cash payments.

To arrive at an accurate balance on a bank reconciliation statement, a service charge should be:

Grouping all transactions involving cash payments together in the cash payments journal strengthens the audit trail.

Accounting: The Language of Business

Analyzing Business Transactions

Analyzing Business Transactions Using T Accounts

The General Journal and the General Ledger

Adjustments and the Worksheet

Closing Entries and Teh Postclosing Trial Balance

Accounting for Sales and Accounts Receivable

Accounting for Purchases and Accounts Payable

Payroll Computations, Records, and Payment

Payroll Taxes, Deposits, and Reports

Accruals, Deferrals, and the Worksheet

Financial Statements and Closing Procedures

Accounting Principles and Reporting Standards

Accounts Receivable and Uncollectible Accounts

Notes Payable and Notes Receivable

Merchandise Inventory

Property, Plant, and Equipment

Accounting for Partnerships

Corporations: Formation and Capital Stock Transactions

Corporate Earnings and Capital Transactions

Long-Term Bonds

Financial Statement Analysis

The Statement of Cash Flows

Departmentalized Profit and Cost Centers

Accounting for Manufacturing Activities

Job Order Cost Accounting

Process Cost Accounting

Controlling Manufacturing Costs: Standard Costs

Cost-Revenue Analysis for Decision Making

Filters

Exam 9: Cash Receipts, Cash Payments, and Banking Procedures

To record the payment of a purchase invoice when a cash discount is taken, the accountant would:

The process of determining why a difference exists between a firm's records and the bank's records and bringing the two sets of records into balance is known as ________ the bank statement.

Hawthorne Inc. uses the perpetual inventory system when recording its cash payments and cash receipts. If the company issues a check to pay for goods purchased and they pay within the discount period, identify the account used to record the discount.

Which of the following statements is NOT correct regarding the cash receipts journal?

The entry to record an additional cash investment by the owner is recorded in:

A firm's bank reconciliation statement shows a book balance of $16,640, a non-interest note collected by the bank of $3,400 an NSF check of $1,650, and a service charge of $60. Its adjusted book balance is:

Purchases Discounts is a contra cost of goods sold account.

Identify the procedure below that is NOT essential for proper control over cash payments.

To arrive at an accurate balance on a bank reconciliation statement, a service charge should be:

Grouping all transactions involving cash payments together in the cash payments journal strengthens the audit trail.

Accounting: The Language of Business

Analyzing Business Transactions

Analyzing Business Transactions Using T Accounts

The General Journal and the General Ledger

Adjustments and the Worksheet

Closing Entries and Teh Postclosing Trial Balance

Accounting for Sales and Accounts Receivable

Accounting for Purchases and Accounts Payable

Payroll Computations, Records, and Payment

Payroll Taxes, Deposits, and Reports

Accruals, Deferrals, and the Worksheet

Financial Statements and Closing Procedures

Accounting Principles and Reporting Standards

Accounts Receivable and Uncollectible Accounts

Notes Payable and Notes Receivable

Merchandise Inventory

Property, Plant, and Equipment

Accounting for Partnerships

Corporations: Formation and Capital Stock Transactions

Corporate Earnings and Capital Transactions

Long-Term Bonds

Financial Statement Analysis

The Statement of Cash Flows

Departmentalized Profit and Cost Centers

Accounting for Manufacturing Activities

Job Order Cost Accounting

Process Cost Accounting

Controlling Manufacturing Costs: Standard Costs

Cost-Revenue Analysis for Decision Making

Filters