Question 1: Assume that a company uses a sales journal, a purchases journal, a cash receipts journal, a cash disbursements journal, and a general journal. A sales return for credit on account would be recorded in the:
- sales journal.
- general journal.
- cash receipts journal.
- accounts receivable ledger.
Question 2: Which of the following statements is true?
- Interest on bonds is tax deductible.
- Interest on bonds is not tax deductible.
- Bonds do not have to be repaid.
- Bonds always decrease return on equity
Question 3: Advance ticket sales totaling $6,000,000 cash would be recognized as follows:
- debit Sales, credit Unearned Revenue.
- debit Unearned Revenue, credit Sales.
- debit Cash, credit Unearned Revenue.
- debit Unearned Revenue, credit Cash.
Question 4: Sales taxes payable:
- is an estimated liability.
- is a contingent liability.
- is a current liability for retailers.
- is a business expense
Question 5: Bonds that give the issuer an option of retiring them before they mature are:
- Serial bonds.
- Sinking fund bonds.
- Registered bonds.
- Callable bonds.