The total on the "Cash Receipts" report at January 31 should equal
A) the total revenue earned for the month of January.
B) the total of the purchases journal on January 31.
C) the total of the Cash Debit column of the cash receipts journal.
D) the balance in Accounts Receivable at January 31.

Question

Quizplus · Accepted Answer

The total on the "Cash Receipts" report should equal the total of the Cash Debit column of the cash receipts journal. This is because the report is a summary of all cash received during the month, and the cash receipts journal records all cash received. The total revenue earned for the month of January would be recorded in the revenue account, not the cash receipts journal. The purchases journal is used to record purchases, not sales or cash receipts. The balance in Accounts Receivable at January 31 is the amount owed to the company by its customers, and is not necessarily the same as the total cash received during the month.

The Total on the "Cash Receipts" Report at January 31