CPB / BookKeeping Journalizing and Posting Transactions 2

Question 1

When a business purchases supplies on account, which journal entry is correct?

Accepted Answer

Debit Supplies, Credit Accounts Payable

Answer

Debit Supplies Expense, Credit Cash

Answer

Debit Accounts Payable, Credit Supplies

Answer

Debit Cash, Credit Supplies

Question 2

A compound journal entry is one that:

Accepted Answer

Involves more than two accounts

Answer

Records only a single debit and single credit

Answer

Is recorded only at month-end

Answer

Corrects a previous entry error

Question 3

After posting from the general journal, the account number is written in the journal's posting reference column to indicate:

Accepted Answer

That the entry has been posted to the ledger

Answer

The page number in the ledger

Answer

The balance in that account

Answer

The date of the original transaction

Question 4

A business receives a $500 cash payment from a customer on a previously recorded account receivable. Which entry is correct?

Accepted Answer

Debit Cash $500, Credit Accounts Receivable $500

Answer

Debit Cash $500, Credit Revenue $500

Answer

Debit Accounts Receivable $500, Credit Cash $500

Answer

Debit Revenue $500, Credit Accounts Receivable $500

Question 5

In which book of original entry are most routine business transactions first recorded?

Accepted Answer

The general journal

Answer

The general ledger

Answer

The balance sheet

Answer

The trial balance

Question 6

What does a credit entry to the owner's Capital account represent?

Accepted Answer

An increase in owner's equity

Answer

A withdrawal by the owner

Answer

An expense paid by the owner

Answer

A decrease in net income

Question 7

An error discovered AFTER a journal entry has been posted should be corrected by:

Accepted Answer

Recording a correcting journal entry

Answer

Erasing the original entry in both journal and ledger

Answer

Drawing a single line through the error and rewriting

Answer

Voiding the transaction and starting over