Cash disbursements journal based problem


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.

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Finance Basics: Cash disbursements journal based problem
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