Accounting flashcard by Audrey,Bo,Jingyu

Front

Which statement most accurately explains the purpose of a special journal in a trading business? Options: It is dedicated to capturing high-frequency, repetitive trading transactions such as credit sales or credit purchases. , It is used to summarise similar transactions to allow totals to be posted (transferred) to the General Ledger. , lt functions as a catch-all record that includes both trading and personal transactions. , It is used to record only end-of-day totals instead of individual transactions.

Back

It is used to summarise similar transactions to allow totals to be posted (transferred) to the General Ledger.

Front

How should the transactions on January 25th be recorded in Business Bo’s Dresses’ Journals after receiving cash from XYZ Ltd for goods sold on credit worth $4,500? Options: It should be recorded in the General Journal as debtors control. It should be recorded in the Cash Receipt Journal as debtors control. It should be recorded in the Cash Purchases Journal as creditors control. It should be recorded in the Cash Receipt Journal as creditors control.

Back

It should be recorded in the Cash Receipt Journal as debtors control.

Front

Why are purchase invoices not always recorded in chronological order in a specialised journal?

Back

Because purchase invoices are issued by different suppliers, and each supplier has their own numbering system.

Front

Why is the Cost of Sales recorded in a special journal each time a sale occurs?

Back

To assist in calculating the profit made on each sale by comparing the selling price with the cost price of the stock sold.

Front

A sole trader bought $5,000 worth of stock on credit from a supplier. Why is this transaction not recorded in the Sales Journal?

Back

Because the transaction involves buying stock on credit instead of selling.