Questions and Answers
What is the term for information for each transaction recorded in a journal?
What is the name of a form for recording transactions in chronological order?
What is a journal amount column headed with an account title called?
What do we call a business paper from which information is obtained for a journal entry?
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What is a journal amount column that is NOT headed with an account title?
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What is the term for the recording of debit and credit parts of a transaction?
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What describes a form detailing goods or services sold, the quantity, and the price?
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What do we call the process of recording transactions in a journal?
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What is the term for determining that the amount of cash agrees with the accounting records?
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What is a business form ordering a bank to pay cash from a bank account called?
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What is an invoice used as when recording a sale on account?
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What is a business form giving written acknowledgment for cash received?
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What form contains a brief message describing a transaction?
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The source document for all cash payments is a sales invoice.
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A receipt is the source document for cash received from transactions other than sales.
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A calculator tape is the source document for daily sales.
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The source document used when supplies are bought on account is a memorandum.
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The journal columns used to record receiving cash from sales are Cash Debit and Sales Credit.
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To correct an error in a journal, simply erase the incorrect item and write the correct item.
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A transaction recorded in a journal is NOT considered a permanent record.
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Transactions are recorded in a journal in chronological order.
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A complete entry consists of the date, the debit amount, and the credit amount.
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The day of the month is written on each journal page only for the first entry.
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Double lines are ruled across a journal's amount columns to indicate that the totals have been verified as correct.
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Cash is always proved at the end of a month.
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Study Notes
Journal and Transactions
- A journal is a chronological record of transactions.
- Each transaction is documented with a source document providing necessary details.
- Journal entries consist of debit and credit parts, relevant for double-entry accounting.
Types of Journal Columns
- Special amount columns are labeled with account titles for specific types of transactions.
- General amount columns do not have account titles; they record various transactions collectively.
Source Documents
- Source documents like invoices and receipts are crucial for journal entries.
- An invoice records details about sold goods or services, including quantity and price.
- A receipt acknowledges cash received and serves as a source document for non-sale transactions like refunds.
Journalizing and Proving Cash
- Journalizing is the process of recording transactions in the journal.
- Proving cash ensures that the amount of cash aligns with the records, typically done at month-end.
Error Correction and Recording Principles
- Errors in a journal cannot be simply erased; they require a proper correction entry.
- Journal entries are considered permanent records, documenting the financial history of transactions.
- Transactions must be recorded in chronological order for accurate tracking.
Understanding Entries
- A complete journal entry includes the date, debit amount, and credit amount for clarity.
- The day is noted on each journal page for all entries, not just the first.
- Double lines across amount columns signify that totals have been verified.
General Knowledge on Cash Transactions
- Cash transactions must be proved regularly, such as at the end of each month, to ensure accuracy in financial reporting.
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Description
This quiz covers the fundamentals of accounting journals and transactions. It addresses the importance of source documents, the process of journalizing, and the role of different journal columns. Test your knowledge on concepts critical to double-entry accounting and cash management.
