Question 1

The listing of cash discounts is not a part of the credit terms.

Accepted Answer

A) True 
 B)False

Question 2

What is the journal entry to record the receipt of payment on February 10th for the following: February 2nd, merchandise sold on account in the amount of $475. Credit terms 2/10, n/30.

Accepted Answer

A)  
Cash $\quad\quad475 \mathrm { DR }$
Accounts Receivable$\quad475 \mathrm { CR }$ 
B)  
$\text { Accounts Receivable } \quad 475 \mathrm{DR}$
$\text { Cash } \quad 475 \mathrm{CR}$ 
C)  
$\begin{array} { l r r } 
\text { Cash } & 465.50 \mathrm { DR } & \
\text { Sales Discount } & 9.50 \mathrm { DR } & \
\quad \text { Accounts Receivable } & & 475 \mathrm { CR }
\end{array}$ 
D) 
$\begin{array} { c r } 
\text { Accounts Receivable } & 475 \mathrm { DR } \
\text { Cash } & 465.50 \mathrm { CR } \
\text { Sales Discount } & 9.5 \mathrm { CR }
\end{array}$ 
A)  
Cash $\quad\quad475 \mathrm { DR }$
Accounts Receivable$\quad475 \mathrm { CR }$ 
B)  
$\text { Accounts Receivable } \quad 475 \mathrm{DR}$
$\text { Cash } \quad 475 \mathrm{CR}$ 
C)  
$\begin{array} { l r r } 
\text { Cash } & 465.50 \mathrm { DR } & \
\text { Sales Discount } & 9.50 \mathrm { DR } & \
\quad \text { Accounts Receivable } & & 475 \mathrm { CR }
\end{array}$ 
D) 
$\begin{array} { c r } 
\text { Accounts Receivable } & 475 \mathrm { DR } \
\text { Cash } & 465.50 \mathrm { CR } \
\text { Sales Discount } & 9.5 \mathrm { CR }
\end{array}$

Question 3

Reduction from the invoice price for prompt payment as recorded on the books of the seller

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 4

Most computer accounting software packages allow businesses to

Accepted Answer

A)  Post cash receipts for sales 
B)  Apply Discounts 
C)  Both A & B 
D)  Neither A or B 
A)  Post cash receipts for sales 
B)  Apply Discounts 
C)  Both A & B 
D)  Neither A or B

Question 5

The normal balance of the Purchases Discounts account is on the credit side.

Accepted Answer

A) True 
 B)False

Question 6

On October 30, goods with a list price of $9,200 are sold, subject to a trade discount of 25 percent with terms of 2/10, n/30. Payment is received from the customer on December 11. The amount of cash received on December 11 is

Accepted Answer

A)  $6,160. 
B)  $8,770. 
C)  $2,640. 
D)  $6,036. 
E)  $6,900. 
A)  $6,160. 
B)  $8,770. 
C)  $2,640. 
D)  $6,036. 
E)  $6,900.

Question 7

Sales of merchandise on account would be recorded in which journal?

Accepted Answer

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

Question 8

Which of the following is true of sales discounts?

Accepted Answer

A)  It is shown as an addition to Other Income on the income statement. 
B)  It is shown on the balance sheet under owner's equity. 
C)  It is shown on the balance sheet under liability. 
D)  It is shown as a deduction from Sales on the income statement. 
E)  It is shown on the balance sheet under short-term assets. 
A)  It is shown as an addition to Other Income on the income statement. 
B)  It is shown on the balance sheet under owner's equity. 
C)  It is shown on the balance sheet under liability. 
D)  It is shown as a deduction from Sales on the income statement. 
E)  It is shown on the balance sheet under short-term assets.

Question 9

Reduction from the invoice price for prompt payment as recorded on the books of the buyer

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 10

Indicate the appropriate columns in which the following transaction would be recorded in the cash receipts journal: Cash collected on account from a customer.

Accepted Answer

A)  
$\begin{array} { l l } 
\text { Cash } & \text { DR } \
\text { Accounts Receivable }
\end{array} \quad \text { CR }$ 
B)  
$\begin{array} { l l } 
\text { Cash } & \text { DR } \
\text { Sales } & \text { CR }
\end{array}$ 
C)  
$\begin{array} { l r } 
\text { Cash } & \text { DR } \
\text { Other Account } & \text { CR }
\end{array}$ 
D)  
Accounts Receivable DR Cash $\quad$ CR 
A)  
$\begin{array} { l l } 
\text { Cash } & \text { DR } \
\text { Accounts Receivable }
\end{array} \quad \text { CR }$ 
B)  
$\begin{array} { l l } 
\text { Cash } & \text { DR } \
\text { Sales } & \text { CR }
\end{array}$ 
C)  
$\begin{array} { l r } 
\text { Cash } & \text { DR } \
\text { Other Account } & \text { CR }
\end{array}$ 
D)  
Accounts Receivable DR Cash $\quad$ CR

Question 11

A credit to an account in the accounts payable ledger would have been posted from the cash payments journal if special journals are used.

Accepted Answer

A) True 
 B)False

Question 12

In the cash receipts journal, the total amount in the Other Accounts column is posted at the end of the month.

Accepted Answer

A) True 
 B)False

Question 13

Payment of merchandise purchased on account within the discount period is recorded in the cash payments journal.

Accepted Answer

A) True 
 B)False

Question 14

What is the recommended order that special journals should be posted to the subsidiary ledgers and the general ledger?

Accepted Answer

A)  Sales, Purchases, Cash Receipts, Cash Payments 
B)  Sales, Purchases, Cash Payments, Cash Receipts 
C)  Sales, Cash Receipts, Purchases, Cash Payments 
D)  No special order is recommended 
A)  Sales, Purchases, Cash Receipts, Cash Payments 
B)  Sales, Purchases, Cash Payments, Cash Receipts 
C)  Sales, Cash Receipts, Purchases, Cash Payments 
D)  No special order is recommended

Question 15

A purchase of merchandise on account is recorded in the cash payments journal.

Accepted Answer

A) True 
 B)False

Question 16

A written promise to pay a specified amount at a specified time

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 17

Proving the equality of debits and credits in a journal should be done after end-of-the-month posting.

Accepted Answer

A) True 
 B)False

Question 18

A withdrawal of cash by the owner for personal use is recorded in the purchases journal.

Accepted Answer

A) True 
 B)False

Question 19

Agreement between seller and buyer on payment

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 20

Accounts Payable would appear as a debit in

Accepted Answer

A)  the cash payments journal. 
B)  the sales journal. 
C)  the purchases journal. 
D)  the cash receipts journal. 
E)  all the special journals. 
A)  the cash payments journal. 
B)  the sales journal. 
C)  the purchases journal. 
D)  the cash receipts journal. 
E)  all the special journals.

The listing of cash discounts is not a part of the credit terms.

What is the journal entry to record the receipt of payment on February 10th for the following: February 2nd, merchandise sold on account in the amount of $475. Credit terms 2/10, n/30.

Reduction from the invoice price for prompt payment as recorded on the books of the seller

Most computer accounting software packages allow businesses to

The normal balance of the Purchases Discounts account is on the credit side.

On October 30, goods with a list price of $9,200 are sold, subject to a trade discount of 25 percent with terms of 2/10, n/30. Payment is received from the customer on December 11. The amount of cash received on December 11 is

Sales of merchandise on account would be recorded in which journal?

Which of the following is true of sales discounts?

Reduction from the invoice price for prompt payment as recorded on the books of the buyer

Indicate the appropriate columns in which the following transaction would be recorded in the cash receipts journal: Cash collected on account from a customer.

A credit to an account in the accounts payable ledger would have been posted from the cash payments journal if special journals are used.

In the cash receipts journal, the total amount in the Other Accounts column is posted at the end of the month.

Payment of merchandise purchased on account within the discount period is recorded in the cash payments journal.

What is the recommended order that special journals should be posted to the subsidiary ledgers and the general ledger?

A purchase of merchandise on account is recorded in the cash payments journal.

A written promise to pay a specified amount at a specified time

Proving the equality of debits and credits in a journal should be done after end-of-the-month posting.

A withdrawal of cash by the owner for personal use is recorded in the purchases journal.

Agreement between seller and buyer on payment

Accounts Payable would appear as a debit in

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

The listing of cash discounts is not a part of the credit terms.

What is the journal entry to record the receipt of payment on February 10th for the following: February 2nd, merchandise sold on account in the amount of $475. Credit terms 2/10, n/30.

Reduction from the invoice price for prompt payment as recorded on the books of the seller

Most computer accounting software packages allow businesses to

The normal balance of the Purchases Discounts account is on the credit side.

On October 30, goods with a list price of $9,200 are sold, subject to a trade discount of 25 percent with terms of 2/10, n/30. Payment is received from the customer on December 11. The amount of cash received on December 11 is

Sales of merchandise on account would be recorded in which journal?

Which of the following is true of sales discounts?

Reduction from the invoice price for prompt payment as recorded on the books of the buyer

Indicate the appropriate columns in which the following transaction would be recorded in the cash receipts journal: Cash collected on account from a customer.

A credit to an account in the accounts payable ledger would have been posted from the cash payments journal if special journals are used.

In the cash receipts journal, the total amount in the Other Accounts column is posted at the end of the month.

Payment of merchandise purchased on account within the discount period is recorded in the cash payments journal.

What is the recommended order that special journals should be posted to the subsidiary ledgers and the general ledger?

A purchase of merchandise on account is recorded in the cash payments journal.

A written promise to pay a specified amount at a specified time

Proving the equality of debits and credits in a journal should be done after end-of-the-month posting.

A withdrawal of cash by the owner for personal use is recorded in the purchases journal.

Agreement between seller and buyer on payment

Accounts Payable would appear as a debit in

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