Question | Answer |
Information in a journal includes the debit and credit parts of each transaction recorded in one place. T or F | True
|
The Objective Evidence accounting concept requires that there be proof that a transaction did occur. | True
| Examples of source documents include checks, sales invoices, receipts, and memorandums. T or F | True
| A memorandum is the source document used when items are paid in cash. T or F | False
| A receipt is the source document for cash received from transactions other than sales. T or F | True
| A calculator tape is the source document for daily cash sales.T or F | True
| The accounts affected when cash is received from the owner as an investment are Cash and Sales.T or F | False
| When cash is paid for supplies, the Cash account is debited. T or F | False
| When cash is used to pay for insurance, the asset account Prepaid Insurance increases. T or F | True
| The source document used when supplies are ordered by telephone on account is a memorandum. T or F | True
| The source document used when supplies bought on account are paid for is a receipt.T or F | False
| When cash is received from sales, both the Cash account and the Sales account are increased. T or F | True
| The source document sales invoice is abbreviated as S in a journal entry.T or F | True
| When services are sold on account, an asset account and a liability account are affected. T or F | False
| The accounts affected when paying cash for equipment rental are Equipment Rental Expense and Cash.T or F | True
| When cash is received on account, one asset account increases and another asset account decreases.T or F | True
| he accounts affected when paying cash to the owner for a withdrawal of equity are the Capital Account and Cash. | False
| If there is only one blank line remaining on a journal page, it is standard practice to split the entry and record the second line of the entry on the next page.T or F | False
| To correct an error in a journal, simply erase the incorrect item and write the correct item in the same place.T or F | False
| If an error is detected in a journal entry after several additional journal entries have been made, the entry should be corrected by drawing a line through the incorrect parts and writing the correct parts on the same line above the error.T or F | True |