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Exam 5: Accounting Systems

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Question 51

Multiple Choice

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Beachside Coffee Shop, in an effort to stream line its accounting system, has decided to utilize a Cash Receipts Journal in its operation. If the company is to record the cash sale of food for $18 which is the correct entry?

A) Cash Cr. $18, Food Revenue Dr. $18,
B) Cash Dr. $18, Food Revenue Dr. $18
C) Cash Dr. $18, Food Revenue Cr. $18
D) Cash Cr. $18, Food Revenue Cr. $18

E) B) and D)
F) A) and B)

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Question 52

Multiple Choice

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A purchase of supplies on account is recorded in the

A) Revenue journal
B) General journal
C) Purchases journal
D) Cash Payments journal

E) C) and D)
F) None of the above

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Question 53

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Explain whether each of the following would usually be used in a computerized accounting system and why. 1. Special journals 2. Accounts receivable control accounts 3. Electronic invoice form 4. Month-end postings to the general ledger

Closing journal entries are recorded in the general journal.

Which of the following is not part of a three-step process that a growing business uses for the evolution of its accounting systems?

Updating information in a computerized accounting system happens at the end of the month.

The basic procedure of posting from a revenue journal is to make all postings at the end of the month.

An accounting system is the methods and procedures used to collect, classify, summarize, and report the businesses financial information

When there are a large number of individual accounts with a common characteristic, it is common to place them in a separate ledger called a(n)

Which of the following is NOT a special journal?

Services performed for cash should be recorded in the

Posting from a revenue journal to the customer account is normally done only at the end of the month.

In which journal would you find cash revenues recorded?

The Other Accounts column in the Cash Receipts journal is used for recording debits to any account for which there is no special debit column.

For each of the following businesses, explain how a purchase journal might be modified for the specific business. 1. North County Medical Center 2. Tri-County Farms, Inc. 3. Prescott's Quick Lube and Tire Store

Every controlling account must have its own

Using the Internet to perform business transactions is called e-commerce.

The total on the "Accounts Payable Creditors Balances" report at January 31, the end of the first month of operations, agrees with the total of the Accounts Payable debit column in the cash payments journal for the same period.

The use of subsidiary ledgers is limited to Accounts Payable and Accounts Receivable.

Which of the following statements is false?