Question 1

The entry to record the issuance of a check in settlement of an interest-bearing promissory note of $4,000 and the interest owed on the note of $100,would be to:

Accepted Answer

A)  debit Interest Expense $100,debit Notes Payable $4,000 and credit Cash $4,100. 
B)  debit Cash $4,100,credit Notes Payable $4,000 and credit Cash $100. 
C)  debit Notes Payable $4,100 and credit Cash $4,100. 
D)  debit Accounts Payable $4,000,debit Interest Expense $100 and credit Cash $4,100.

Question 2

To transfer ownership of a check from one party to another,it is necessary to ____________________ the check.

Accepted Answer

The answer of To transfer ownership of a check from...

Question 3

Purchases Discounts is a contra cost of goods sold account.

Accepted Answer

A) True 
 B)False

Question 4

Record the following transactions for the month of April 2016 on page 6 of a cash payments journal.Total,prove,and rule the cash payments journal as of April 30.

Accepted Answer

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

Question 5

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

Question 6

If a firm's bank reconciliation statement shows a bank statement balance of $12,000,total deposits in transit of $1,500,and total outstanding checks of $1,000,the adjusted bank balance is ____________________.

Accepted Answer

The answer of If a firm's bank reconciliation statement shows...

Question 7

No end-of-month posting is required for the total of the Other Accounts Debit column of the cash payments journal.

Accepted Answer

A) True 
 B)False

Question 8

Indicate in which section of the Bank Reconciliation Statement the following reconciling items would appear.  A deposit in transit.

Accepted Answer

A)  Option A 
B)  Option B 
C)  Option C 
D)  Option D

Question 9

To record payment of sales tax owed,the accountant would debit ____________________ and credit Cash.

Accepted Answer

The answer of To record payment of sales tax owed,the...

Question 10

The Petty Cash Fund account has a(n)____________________ balance.

Accepted Answer

The answer of The Petty Cash Fund account has a(n)____________________...

Question 11

To arrive at an accurate balance on a bank reconciliation statement,an error made by the bank in which the bank deducted a check issued by another business from the balance of the company's bank account should be

Accepted Answer

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

Question 12

Merchandise is sold for $8,820,terms 1/10,n/30.Prior to payment,the customer returned $560 of the merchandise.If the invoice is paid within the discount period the amount of the sales discount is:

Accepted Answer

A)  $82.60 
B)  $165.20 
C)  $88.20 
D)  $93.80

Question 13

Read each of the following transactions.Determine the accounts to be debited and credited.
A)Collected cash in settlement of a $600 promissory note plus interest of $18.
B)Jaime Gomez,the owner,made an additional cash investment of $11,000.
C)Sold merchandise for $3,000 in cash plus sales tax of $210.There was a cash overage of $4.

Accepted Answer

The answer of Read each of the following transactions.Determine the...

Question 14

Read each of the following transactions.Determine the accounts to be debited and credited.
A)Issued a check for $2,500 to Jaime Gomez,the owner,as a cash withdrawal for personal use.
B)Issued a check for $75 to establish a petty cash fund.
C)Issued a check for $50 to replenish the petty cash fund.An analysis of the payments from the fund showed the following totals: Supplies,$25;Delivery Expense,$10;Miscellaneous Expense,$15.

Accepted Answer

The answer of Read each of the following transactions.Determine the...

Question 15

Record the following transactions for the month of November 2016 on page 18 of a cash payments journal.Total,prove,and rule the cash payments journal as of November 30.

Accepted Answer

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

Question 16

The cash payments journal for Excel Company is shown below.Describe how the amounts would be posted to the general ledger accounts.

Accepted Answer

The answer of The cash payments journal for Excel Company...

Question 17

When a bank deducts any amount other than a paid check from a depositor's account,it issues a form called a(n)____________________ memorandum.

Accepted Answer

The answer of When a bank deducts any amount other...

Question 18

On March 31,2016,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.  Instructions:
1.Prepare a bank reconciliation statement for the firm as of March 31,2016.
2.Record entries for any items on the bank reconciliation statement that must be journalized.Date the entries March 31,2016.Use page 4 of a general journal.

Accepted Answer

The answer of On March 31,2016,Home Decorating Pavilion received a...

Question 19

Checks issued by a firm that were paid by the bank and returned to the firm with the bank statement are called ____________________ checks.

Accepted Answer

The answer of Checks issued by a firm that were...

Question 20

The cash receipts journal for Arlen Company is shown below.Describe how the amounts would be posted to the general ledger accounts.

Accepted Answer

The answer of The cash receipts journal for Arlen Company...

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