Ch 9 Purch/Cash Paymts Supp

The total of accounts in the accounts payable subsidiary ledger equals the balance of the controlling account, Accounts Payable.

• True
• False

The contra account Purchases Discount has a normal debit balance.

• True
• False

A merchandising business places Purchases in the Operating Expenses section of the income statement.

• True
• False

A merchandising business places Purchases in the Cost of Merchandise section of the income statement.

• True
• False

The periodic inventory method does not require records of the quantity and cost of individual goods.

• True
• False

The total of a schedule of accounts payable less purchases discounts taken during the month will equal the total of Accounts Payable.

• True
• False

A transaction to record merchandise purchased with a trade discount would include a debit to Merchandise Discount.

• True
• False

The petty cash account, Cash Short and Over, is a temporary account.

• True
• False

A corporation can own property, incur liabilities, and enter into contracts in its own name.

• True
• False

A corporation ceases to exist with the owner dies.

• True
• False