Question 1

The entry to create a petty cash fund includes

Accepted Answer

When creating a petty cash fund, cash is transferred from the main cash account to the petty cash fund account. Therefore, there should be a debit to Petty Cash Fund and a credit to Cash.

Question 2

A firm's bank reconciliation statement shows a book balance of $15,820,an NSF check of $400,and a service charge of $20.Its adjusted book balance is

Accepted Answer

The adjusted book balance is calculated by subtracting the NSF check and the service charge from the book balance: $15,820 - $400 - $20 = $15,400.

Question 3

The entry to replenish a petty cash fund includes

Accepted Answer

When replenishing a petty cash fund, you record the expenses incurred by debiting the relevant expense accounts and credit the Cash account to reflect the cash used from the fund.

Question 4

Identify the procedure below that is

Accepted Answer

Holding all cash received during a month and making one bank deposit at the end of the month is not a good practice as it increases the risk of theft or loss and does not ensure timely recording of transactions.

Question 5

The entry to record an additional cash investment by the owner is recorded in

Accepted Answer

The answer of The entry to record an additional cash...

Question 6

To record the payment of a purchase invoice when a cash discount is taken,the accountant would

Accepted Answer

When a cash discount is taken, the accountant debits Accounts Payable for the full invoice amount, credits Purchases Discounts for the discount taken, and credits Cash for the net amount paid.

Question 7

On a bank reconciliation statement,you would find all of the following except:

Accepted Answer

A list of canceled checks is not typically included in a bank reconciliation statement. The statement focuses on reconciling the bank balance with the company's ledger, which involves outstanding checks, NSF checks, and bank service charges.

Question 8

A firm's bank reconciliation statement shows a book balance of $31,640,an NSF check of $800,and a service charge of $40.Its adjusted book balance is

Accepted Answer

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

Question 9

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 10

The process of determining why a difference exists between a firm's records and the bank's records and bringing the two sets of records into balance is known as ____________________ the bank statement.

Accepted Answer

The answer of The process of determining why a difference...

Question 11

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 12

Which of the following statements is NOT correct regarding the cash receipts journal?

Accepted Answer

The answer of Which of the following statements is NOT...

Question 13

Which of the following statements is not correct?

Accepted Answer

The entry to record the receipt of a promissory note to replace an open account is not recorded in the cash receipts journal. It should be recorded in the general journal.

Question 14

Which of the following statements is correct?

Accepted Answer

This statement is correct. A cash purchase of merchandise would result in a debit to Purchases and a credit to Cash. Option A is incorrect because the entry to record payment of an invoice within the cash discount period would include a credit to the Purchases Discounts account, not a debit. Option C is incorrect because a transaction recorded in the cash payments journal would include a debit to the relevant expense account and a credit to Cash. Option D is incorrect because Purchase Discounts is a contra expense account, not a contra revenue account.

Question 15

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 16

To arrive at an accurate balance on a bank reconciliation statement,outstanding checks should be

Accepted Answer

Outstanding checks represent checks that have been issued by the company but have not yet been cashed by the recipients. These checks are still considered as outstanding liabilities of the company and, therefore, should be deducted from the bank statement balance to arrive at an accurate balance on a bank reconciliation statement.

Question 17

Upon collection of the amount due on an interest-bearing promissory note from a customer,the accountant would debit Cash,credit Notes Receivable,and

Accepted Answer

When collecting on an interest-bearing promissory note, the accountant will credit the Notes Receivable account and debit the Cash account. Additionally, since there is interest being earned on the note, the accountant will credit the Interest Income account to record the interest earned. Therefore, the correct choice is to credit Interest Income (B). There is no need to record any interest expense in this transaction.

Question 18

Checks issued by a firm and entered in its records that have not been paid by the bank are called ____________________ checks.

Accepted Answer

The answer of Checks issued by a firm and entered...

Question 19

A cash sale of merchandise would be recorded in

Accepted Answer

A cash sale of merchandise represents a receipt of cash, which would be recorded in the cash receipts journal. The cash receipts journal records all cash received by a business, including cash sales of merchandise.

Question 20

Identify the procedure below that is

Accepted Answer

The answer of Identify the procedure below that is
...

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

The entry to create a petty cash fund includes

A firm's bank reconciliation statement shows a book balance of $15,820,an NSF check of $400,and a service charge of $20.Its adjusted book balance is

The entry to replenish a petty cash fund includes

Identify the procedure below that is

The entry to record an additional cash investment by the owner is recorded in

To record the payment of a purchase invoice when a cash discount is taken,the accountant would

On a bank reconciliation statement,you would find all of the following except:

A firm's bank reconciliation statement shows a book balance of $31,640,an NSF check of $800,and a service charge of $40.Its adjusted book balance is

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

The process of determining why a difference exists between a firm's records and the bank's records and bringing the two sets of records into balance is known as ____________________ the bank statement.

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

Which of the following statements is NOT correct regarding the cash receipts journal?

Which of the following statements is not correct?

Which of the following statements is correct?

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 ____________________.

To arrive at an accurate balance on a bank reconciliation statement,outstanding checks should be

Upon collection of the amount due on an interest-bearing promissory note from a customer,the accountant would debit Cash,credit Notes Receivable,and

Checks issued by a firm and entered in its records that have not been paid by the bank are called ____________________ checks.

A cash sale of merchandise would be recorded in

Identify the procedure below that is