Question 1

Which of the following is NOT an example of good internal controls over purchases?

Accepted Answer

A) Purchases made only after proper authorization 
B) Purchase Orders Pre-Numbered 
C) Carefully checking in goods upon receipt for quantity and damage 
D) For maximum control, one person should handle the entire purchase process from ordering to paying for the goods. 
A) Purchases made only after proper authorization 
B) Purchase Orders Pre-Numbered 
C) Carefully checking in goods upon receipt for quantity and damage 
D) For maximum control, one person should handle the entire purchase process from ordering to paying for the goods.

Question 2

An account in the general ledger that summarizes the balances found in the subsidiary ledger(s) is:

Accepted Answer

A) General Account 
B) Controlling Account 
C) Ledger Account 
D) Journal Account 
A) General Account 
B) Controlling Account 
C) Ledger Account 
D) Journal Account

Question 3

An account that is used to record merchandise bought for resale:

Accepted Answer

A) Purchases Account 
B) Purchases Returns & Allowance 
C) Sales Discount 
D) Supplies 
A) Purchases Account 
B) Purchases Returns & Allowance 
C) Sales Discount 
D) Supplies

Question 4

An account used to record transportation charges on incoming merchandise intended for resale:

Accepted Answer

A) Freight-Out 
B) Freight-Received 
C) Freight-In 
D) Merchandise Freight 
A) Freight-Out 
B) Freight-Received 
C) Freight-In 
D) Merchandise Freight

Question 5

Entries in the purchases journal are posted to the

Accepted Answer

A) general ledger only. 
B) accounts payable ledger only. 
C) accounts payable ledger and the purchases ledger. 
D) general ledger and the accounts payable ledger. 
E) accounts payable ledger and the accounts receivable ledger. 
A) general ledger only. 
B) accounts payable ledger only. 
C) accounts payable ledger and the purchases ledger. 
D) general ledger and the accounts payable ledger. 
E) accounts payable ledger and the accounts receivable ledger.

Question 6

One of the advantages of a sales journal is that it eliminates individual posting of entries to the Accounts Receivable account in the general ledger.

Accepted Answer

A) True 
 B)False

Question 7

The account that is credited for every transaction in the purchases journal is

Accepted Answer

A) Cash. 
B) Purchases Discounts. 
C) Accounts Receivable. 
D) Sales Discounts 
E) Accounts Payable. 
A) Cash. 
B) Purchases Discounts. 
C) Accounts Receivable. 
D) Sales Discounts 
E) Accounts Payable.

Question 8

The Purchases account is used to record the buying of goods and supplies.

Accepted Answer

A) True 
 B)False

Question 9

Match the terms below with the correct definitions.
  
-Business form prepared by the seller

Accepted Answer

The answer of Match the terms below with the correct...

Question 10

A company's written offer to buy goods:

Accepted Answer

A) Offer for Goods 
B) Purchase Requisition 
C) Purchase Order 
D) Purchase Source Document 
A) Offer for Goods 
B) Purchase Requisition 
C) Purchase Order 
D) Purchase Source Document

Question 11

Freight charges on store equipment purchased FOB shipping point should be debited to Store Equipment.

Accepted Answer

A) True 
 B)False

Question 12

Freight charges may be

Accepted Answer

A) listed separately on the invoice. 
B) billed separately from the invoice. 
C) included in the price of the goods on the invoice. 
D) all of these. 
E) none of these. 
A) listed separately on the invoice. 
B) billed separately from the invoice. 
C) included in the price of the goods on the invoice. 
D) all of these. 
E) none of these.

Question 13

Merchandising companies include

Accepted Answer

A) Wholesales 
B) Retailers 
C) Both A & B 
D) Neither A or B 
A) Wholesales 
B) Retailers 
C) Both A & B 
D) Neither A or B

Question 14

Amounts are posted individually from the purchases journal to the

Accepted Answer

A) Credit column of the creditors' accounts in the accounts payable ledger. 
B) Credit column of the Inventory account in the general ledger. 
C) Credit column of the Accounts Receivable account in the general ledger. 
D) Debit column of the Cash account in the general ledger. 
E) Credit column of the Cash account in the general ledger. 
A) Credit column of the creditors' accounts in the accounts payable ledger. 
B) Credit column of the Inventory account in the general ledger. 
C) Credit column of the Accounts Receivable account in the general ledger. 
D) Debit column of the Cash account in the general ledger. 
E) Credit column of the Cash account in the general ledger.

Question 15

A contra-account that records the company's returns of merchandise purchased from suppliers:

Accepted Answer

A) Purchases Discounts 
B) Sales Returns and Allowances 
C) Freight-In 
D) Purchases Returns and Allowances 
A) Purchases Discounts 
B) Sales Returns and Allowances 
C) Freight-In 
D) Purchases Returns and Allowances

Question 16

Special journals are books of original entry that help simplify the recording process. Which is NOT an example of a special journal?

Accepted Answer

A) Sales Journal 
B) General Journal 
C) Purchase Journal 
D) Cash Receipts Journal 
E) Cash Payments Journal 
A) Sales Journal 
B) General Journal 
C) Purchase Journal 
D) Cash Receipts Journal 
E) Cash Payments Journal

Question 17

For the following account titles, indicate if it is used in a periodic, perpetual, or both inventory system(s) when journalizing transactions by placing an X in the appropriate column.

Accepted Answer

The answer of For the following account titles, indicate if...

Question 18

Which is NOT a characteristic of the Sales Returns and Allowance Account?

Accepted Answer

A) It has a debit balance 
B) It tracks returns from vendors 
C) It tracks returns from customers 
D) It is a contra-revenue account 
A) It has a debit balance 
B) It tracks returns from vendors 
C) It tracks returns from customers 
D) It is a contra-revenue account

Question 19

Customers' individual accounts are included in a subsidiary ledger referred to as the

Accepted Answer

A) accounts payable ledger. 
B) controlling ledger. 
C) miscellaneous ledger. 
D) accounts receivable ledger. 
E) general ledger. 
A) accounts payable ledger. 
B) controlling ledger. 
C) miscellaneous ledger. 
D) accounts receivable ledger. 
E) general ledger.

Question 20

When recording sales of goods for cash, debit Accounts Receivable and credit Cash.

Accepted Answer

A) True 
 B)False

Which of the following is NOT an example of good internal controls over purchases?

An account in the general ledger that summarizes the balances found in the subsidiary ledger(s) is:

An account that is used to record merchandise bought for resale:

An account used to record transportation charges on incoming merchandise intended for resale:

Entries in the purchases journal are posted to the

One of the advantages of a sales journal is that it eliminates individual posting of entries to the Accounts Receivable account in the general ledger.

The account that is credited for every transaction in the purchases journal is

The Purchases account is used to record the buying of goods and supplies.

Match the terms below with the correct definitions. -Business form prepared by the seller

A company's written offer to buy goods:

Freight charges on store equipment purchased FOB shipping point should be debited to Store Equipment.

Freight charges may be

Merchandising companies include

Amounts are posted individually from the purchases journal to the

A contra-account that records the company's returns of merchandise purchased from suppliers:

Special journals are books of original entry that help simplify the recording process. Which is NOT an example of a special journal?

For the following account titles, indicate if it is used in a periodic, perpetual, or both inventory system(s) when journalizing transactions by placing an X in the appropriate column.

Which is NOT a characteristic of the Sales Returns and Allowance Account?

Customers' individual accounts are included in a subsidiary ledger referred to as the

When recording sales of goods for cash, debit Accounts Receivable and credit Cash.

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 Including Appendix

Bank Accounts and Cash Funds

Employee Earnings and Deductions

Employer Taxes, Payments, and Reports

Cash Receipts and Cash Payments

Work Sheet and Adjusting Entries

Financial Statements, Closing Entries, and Reversing Entries

Filters

Exam 9: Sales and Purchases

Which of the following is NOT an example of good internal controls over purchases?

An account in the general ledger that summarizes the balances found in the subsidiary ledger(s) is:

An account that is used to record merchandise bought for resale:

An account used to record transportation charges on incoming merchandise intended for resale:

Entries in the purchases journal are posted to the

One of the advantages of a sales journal is that it eliminates individual posting of entries to the Accounts Receivable account in the general ledger.

The account that is credited for every transaction in the purchases journal is

The Purchases account is used to record the buying of goods and supplies.

Match the terms below with the correct definitions. -Business form prepared by the seller

A company's written offer to buy goods:

Freight charges on store equipment purchased FOB shipping point should be debited to Store Equipment.

Freight charges may be

Merchandising companies include

Amounts are posted individually from the purchases journal to the

A contra-account that records the company's returns of merchandise purchased from suppliers:

Special journals are books of original entry that help simplify the recording process. Which is NOT an example of a special journal?

For the following account titles, indicate if it is used in a periodic, perpetual, or both inventory system(s) when journalizing transactions by placing an X in the appropriate column.

Which is NOT a characteristic of the Sales Returns and Allowance Account?

Customers' individual accounts are included in a subsidiary ledger referred to as the

When recording sales of goods for cash, debit Accounts Receivable and credit Cash.

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 Including Appendix

Bank Accounts and Cash Funds

Employee Earnings and Deductions

Employer Taxes, Payments, and Reports

Cash Receipts and Cash Payments

Work Sheet and Adjusting Entries

Financial Statements, Closing Entries, and Reversing Entries

Filters