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WorksheetsJournalizing Sales and Cash Receipt Transactions - Chapter 11
Total questions: 27
Worksheet time: 15mins
The revenue account Sales has a normal credit balance.
True
False
The liability account Sales Tax Payable has a normal debit balance.
True
False
Very few states in the US require collecting a tax on sales of merchandise to customers.
True
False
Sales tax rates are usually stated as a percentage of sales.
True
False
Businesses must file reports with the proper government unit and pay the amount of sales tax collected.
True
False
The bank that issues the credit card, bills the customer and collects the amount owed.
True
False
Equality of debits and credits in a journal is proved at the end of each month.
True
False
A person or business to whom merchandise or services are sold is a customer.
True
False
Sales is a tax on sale of merchandise or services.
True
False
Purchases and sales of merchandise are the two major activities of a merchandising business.
True
False
The Realization of Revenue accounting concept is applied when a sale is recorded at the time the sale is made.
True
False
A cash sale is a sale in which a credit card is used for the total amount of the sale at the time of the transaction.
True
False
The amount of sales tax collected is an asset of the business until paid to the state government.
True
False
Accounts Receivable is an asset account with a normal debit balance.
True
False
The account Sales Tax Payable is increased by a debit and decreased by a credit.
True
False
The source document for a cash sale is a cash register tape.
True
False
Charge customer accounts are summarized in a general ledger account titled Accounts Receivable.
True
False
When cash is received on account, Cash is increased and Accounts Receivable is increased.
True
False
Cash is proved when the total of the Cash Debit column equals the total of the Cash Credit column.
True
False
The amount of sales tax on a sale is calculated as price of goods:
plus the sales tax rate
times the sales tax rate
minus the sales tax rate
divided by the sales tax rate
If a customer buys $300 worth of merchandise and tax is 8%, the total bill the customer must pay is:
$300
$304
$324
$342
Using a cash register tape as a source document for weekly cash and credit card sales is an application of the accounting concept:
Matching Expenses with Revenue
Objective Evidence
Realization of Revenue
Business Entity
The journal entry for a cash and credit card sales transaction is:
debit Cash, credit Sales; credit Sales Tax Payable
debit Cash; debit Sales Tax Payable; credit Sales
debit Sales, credit Cash, credit Sales Tax Payable
debit Sales Tax Payable, debit Cash, credit Sales
Sales invoices should be:
numbered in sequence
prepared in triplicate
used as a source document for sales on account
all of these
A sale on account transaction:
increases the balance of the accounts payable account
increases the amount to be collected later from a customer
decreases the amount to be collected later from a customer
decreases the balance of the accounts receivable account
When merchandise is sold on account and sales tax is also collected:
Accounts Receivable is credited for the total sale and sales tax
the accounts receivable account balance is increased
Sales is debited for the price of the goods
the sales tax is not reported
The journal entry for a cash receipt on account is:
debit Cash, credit Accounts Receivable
debit Cash, credit Accounts Payable
debit Accounts Payable, credit Cash
debit Accounts Payable, credit Accounts Receivable
