Question 1

What does the "2" in 2/10, n/30 mean?

Accepted Answer

A)  The credit period 
B)  Discount taken if paid within 10 days 
C)  Discount taken if paid within 30 days 
D)  The due date 
A)  The credit period 
B)  Discount taken if paid within 10 days 
C)  Discount taken if paid within 30 days 
D)  The due date B

Question 2

A sizable reduction from the list price of merchandise purchased that is NOT recorded on the buyers books.

Accepted Answer

A)  Sales Discount 
B)  Purchase Discount 
C)  Trade Discount 
D)  Purchase Adjustment 
A)  Sales Discount 
B)  Purchase Discount 
C)  Trade Discount 
D)  Purchase Adjustment C

Question 3

The design of a cash payments journal can help the accountant reduce the number of postings required.

Accepted Answer

A) True 
 B)False  True

Question 4

Stryker Company issued a check for June rent in the amount of $650. In what journal would this transaction be recorded.

Accepted Answer

A)  Sales Journal 
B)  Cash Payment Journal 
C)  Cash Receipt Journal 
D)  General Journal 
A)  Sales Journal 
B)  Cash Payment Journal 
C)  Cash Receipt Journal 
D)  General Journal

Question 5

Carlyle Company sold goods for $425 plus a 7 percent sales tax to a customer using a bank credit card. The bank deducts a 3 percent discount. Carlyle Company debits Cash for

Accepted Answer

A)  $441.11. 
B)  $412.25. 
C)  $454.75. 
D)  $437.75. 
E)  $468.50. 
A)  $441.11. 
B)  $412.25. 
C)  $454.75. 
D)  $437.75. 
E)  $468.50.

Question 6

Trade discounts are

Accepted Answer

A)  Price reductions for bartered services 
B)  Price reductions from list prices 
C)  Price reductions from net prices 
D)  Price reductions for companies that trade goods and services 
A)  Price reductions for bartered services 
B)  Price reductions from list prices 
C)  Price reductions from net prices 
D)  Price reductions for companies that trade goods and services

Question 7

The entry to purchase a one-year insurance policy for cash would be recorded in the cash payments journal in the

Accepted Answer

A)  Cash Debit column and the Accounts Payable Debit column. 
B)  Other Accounts Debit column and the Cash Credit column. 
C)  Accounts Payable Debit column and the Cash Credit column. 
D)  Cash Debit column and the Other Accounts Credit column. 
E)  Accounts Payable Debit column and the Other Accounts Credit column. 
A)  Cash Debit column and the Accounts Payable Debit column. 
B)  Other Accounts Debit column and the Cash Credit column. 
C)  Accounts Payable Debit column and the Cash Credit column. 
D)  Cash Debit column and the Other Accounts Credit column. 
E)  Accounts Payable Debit column and the Other Accounts Credit column.

Question 8

The following transactions were completed by Fox and Company during the second half of December for the current year. Terms of sale are 2/10, n/30 using a periodic inventory system.
Instructions:
   
1.Journalize the transactions for December in the appropriate journals.
2.Total and rule the journals.
3.Prove the equality of the debit and credit totals.

Accepted Answer

1-2.)
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Question 9

An investment of cash by the owner is recorded in the general journal unless a cash receipts journal is used.

Accepted Answer

A) True 
 B)False

Question 10

Which of the following accounts normally has a credit balance?

Accepted Answer

A)  Sales Discounts 
B)  Sales Returns and Allowances 
C)  Purchases Returns and Allowances 
D)  Purchases 
E)  Accounts Receivable 
A)  Sales Discounts 
B)  Sales Returns and Allowances 
C)  Purchases Returns and Allowances 
D)  Purchases 
E)  Accounts Receivable

Question 11

A cash discount of 1/15, n/30 included in the credit terms of a sale indicates that the buyer should make payment:

Accepted Answer

A)  within 15 days to avail the discount of 1%. 
B)  after 30 days to avail the discount of 2%. 
C)  within 15 days to avail the discount of 2%. 
D)  after 30 days to avail the discount of 1%. 
A)  within 15 days to avail the discount of 1%. 
B)  after 30 days to avail the discount of 2%. 
C)  within 15 days to avail the discount of 2%. 
D)  after 30 days to avail the discount of 1%.

Question 12

Special journal used for recording transactions decreasing cash

Accepted Answer

A) Purchases discount 
B) Cash discount 
C) Trade discount 
D) Credit terms 
E) Cash payments journal
F)Promissory note
G)Cash receipts journal
H)Credit Card Expense
I)Credit period
J)Sales discount 
A) Purchases discount 
B) Cash discount 
C) Trade discount 
D) Credit terms 
E) Cash payments journal
F)Promissory note
G)Cash receipts journal
H)Credit Card Expense
I)Credit period
J)Sales discount

Question 13

Which of the following is true of special journals?

Accepted Answer

A)  They provide details of individual figures of all the transactions in a financial year. 
B)  They save time in posting totals of the special columns to the general ledger. 
C)  They do not deal with the recording of cash transactions. 
D)  They are more efficient as they rule out the delegation of journalizing function to different people in an organization. 
A)  They provide details of individual figures of all the transactions in a financial year. 
B)  They save time in posting totals of the special columns to the general ledger. 
C)  They do not deal with the recording of cash transactions. 
D)  They are more efficient as they rule out the delegation of journalizing function to different people in an organization.

Question 14

The account used to record the reduction given to customers for prompt payments.

Accepted Answer

A)  Purchases Discount 
B)  Purchases Returns & Allowances 
C)  Sales Discounts 
D)  Sales Returns and Allowances 
A)  Purchases Discount 
B)  Purchases Returns & Allowances 
C)  Sales Discounts 
D)  Sales Returns and Allowances

Question 15

Credit postings to the Accounts Receivable general ledger account come from the cash receipts journal and the general journal.

Accepted Answer

A) True 
 B)False

Question 16

Which of the following is not an advantage of the cash receipts journal?

Accepted Answer

A)  Transactions can be recorded on one line. 
B)  Transactions involving debits to cash are recorded in one place. 
C)  Special columns are not used in the cash receipts journal. 
D)  Posting repetition is eliminated. 
A)  Transactions can be recorded on one line. 
B)  Transactions involving debits to cash are recorded in one place. 
C)  Special columns are not used in the cash receipts journal. 
D)  Posting repetition is eliminated.

Question 17

A period of time that the buyer is given by the seller to pay his or her purchases on account.

Accepted Answer

A)  Credit Terms 
B)  Credit Agreement 
C)  Credit Period 
D)  Payment Period 
A)  Credit Terms 
B)  Credit Agreement 
C)  Credit Period 
D)  Payment Period

Question 18

Individual amounts in the Accounts Receivable Credit column of a cash receipts journal are

Accepted Answer

A)  posted monthly to the accounts receivable ledger. 
B)  posted monthly to the general ledger. 
C)  posted daily to the accounts receivable ledger. 
D)  posted daily to the general ledger. 
E)  not posted. 
A)  posted monthly to the accounts receivable ledger. 
B)  posted monthly to the general ledger. 
C)  posted daily to the accounts receivable ledger. 
D)  posted daily to the general ledger. 
E)  not posted.

Question 19

Sales Tax Payable is recorded on the books of the purchaser.

Accepted Answer

A) True 
 B)False

Question 20

The Purchases Discounts account is recorded on the books of both the seller and the purchaser.

Accepted Answer

A) True 
 B)False

What does the "2" in 2/10, n/30 mean?

A sizable reduction from the list price of merchandise purchased that is NOT recorded on the buyers books.

The design of a cash payments journal can help the accountant reduce the number of postings required.

Stryker Company issued a check for June rent in the amount of $650. In what journal would this transaction be recorded.

Carlyle Company sold goods for $425 plus a 7 percent sales tax to a customer using a bank credit card. The bank deducts a 3 percent discount. Carlyle Company debits Cash for

Trade discounts are

The entry to purchase a one-year insurance policy for cash would be recorded in the cash payments journal in the

An investment of cash by the owner is recorded in the general journal unless a cash receipts journal is used.

Which of the following accounts normally has a credit balance?

A cash discount of 1/15, n/30 included in the credit terms of a sale indicates that the buyer should make payment:

Special journal used for recording transactions decreasing cash

Which of the following is true of special journals?

The account used to record the reduction given to customers for prompt payments.

Credit postings to the Accounts Receivable general ledger account come from the cash receipts journal and the general journal.

Which of the following is not an advantage of the cash receipts journal?

A period of time that the buyer is given by the seller to pay his or her purchases on account.

Individual amounts in the Accounts Receivable Credit column of a cash receipts journal are

Sales Tax Payable is recorded on the books of the purchaser.

The Purchases Discounts account is recorded on the books of both the seller and the purchaser.

Asset, Liability, Owners Equity, Revenue, and Expense Accounts

T Accounts, Debits and Credits, Trial Balance, and Financial Statements

The General Journal and the General Ledger

Adjusting Entries and the Work Sheet

Closing Entries and the Post-Closing Trial Balance

Bank Accounts, Cash Funds, and Internal Controls

Employee Earnings and Deductions

Employer Taxes, Payments, and Reports

Sales and Purchases

Work Sheet and Adjusting Entries

Financial Statements, Closing Entries, and Reversing Entries

Methods of Depreciation

Bad Debts

Inventory Methods

Notes Receivablenotes Payable

Filters

Exam 10: Cash Receipts and Cash Payments

What does the "2" in 2/10, n/30 mean?

A sizable reduction from the list price of merchandise purchased that is NOT recorded on the buyers books.

The design of a cash payments journal can help the accountant reduce the number of postings required.

Stryker Company issued a check for June rent in the amount of $650. In what journal would this transaction be recorded.

Carlyle Company sold goods for $425 plus a 7 percent sales tax to a customer using a bank credit card. The bank deducts a 3 percent discount. Carlyle Company debits Cash for

Trade discounts are

The entry to purchase a one-year insurance policy for cash would be recorded in the cash payments journal in the

An investment of cash by the owner is recorded in the general journal unless a cash receipts journal is used.

Which of the following accounts normally has a credit balance?

A cash discount of 1/15, n/30 included in the credit terms of a sale indicates that the buyer should make payment:

Special journal used for recording transactions decreasing cash

Which of the following is true of special journals?

The account used to record the reduction given to customers for prompt payments.

Credit postings to the Accounts Receivable general ledger account come from the cash receipts journal and the general journal.

Which of the following is not an advantage of the cash receipts journal?

A period of time that the buyer is given by the seller to pay his or her purchases on account.

Individual amounts in the Accounts Receivable Credit column of a cash receipts journal are

Sales Tax Payable is recorded on the books of the purchaser.

The Purchases Discounts account is recorded on the books of both the seller and the purchaser.

Asset, Liability, Owners Equity, Revenue, and Expense Accounts

T Accounts, Debits and Credits, Trial Balance, and Financial Statements

The General Journal and the General Ledger

Adjusting Entries and the Work Sheet

Closing Entries and the Post-Closing Trial Balance

Bank Accounts, Cash Funds, and Internal Controls

Employee Earnings and Deductions

Employer Taxes, Payments, and Reports

Sales and Purchases

Work Sheet and Adjusting Entries

Financial Statements, Closing Entries, and Reversing Entries

Methods of Depreciation

Bad Debts

Inventory Methods

Notes Receivablenotes Payable

Filters