Finacre - PQ2

Which of the following statements is correct?

• The sales discount column is included in the cash receipts journal

• The purchases journal records all purchases of merchandise whether for cash or on account

• The cash receipts journal records sales on account

• Merchandise returned by the buyer is recorded by the seller in the purchases journal

When special journals are used:

• all purchase transactions are recorded in the purchases journal

• all cash received, except from cash sales, is recorded in the cash receipts journal

• all cash disbursements are recorded in the cash payments journal

• a general journal is not necessary

If a customer returns goods for credit, an entry is normally made in the

• cash payments journal

• sales journal

• general journal

• cash receipts journal

Supplies were purchased on credit and the entry was recorded in the Purchases Journal. When a part of this supply purchase is returned to the vendor, the entry to record the return will be in the general journal. What will be the journal entry for this return?

• debit Cash and credit Supplies

• debit Supplies and credit Accounts Receivable

• debit Accounts Payable and credit Supplies

• debit Supplies and credit Cash

When special journals are used, a General Journal is

• still required

• not needed

• used only to record sales returns and allowances

• used only to record cash deposits of owner investments

Which of the following statements is false with regard to a Cash Receipts Journal?

• All receipts of cash from customers should be recorded in it

• Receipts of cash from the owner should not be recorded in it

• Receipt of cash from cash sales should be recorded in it

• Receipt of cash from borrowing should be recorded in it

In which special journal should the following transaction be recorded: Services are purchased on account?

• Sales journal

• Purchases journal

• Cash receipts journal

• Cash disbursements journal

In which special journal should the following transaction be recorded: Cash collected from credit account customer?

• Sales journal

• Purchases journal

• Cash receipts journal

• Cash disbursements journal

In which special journal should the following transaction be recorded: Cash purchase of equipment?

• Sales journal

• Purchases journal

• Cash receipts journal

• Cash disbursements journal

In which journal should the following transaction be recorded: Adjusted prepaid insurance account at end of accounting period?

• Sales journal

• Purchases journal

• Cash receipts journal

• General Journal