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College Accounting

John Price, University of North Texas
M. David Haddock, Chattanooga State Technical Comm. College
Horace Brock, University of North Texas
Connie Hahn, Southern Alberta Institute of Technology
Traven Reed, Canadore College

Accounting for Sales, Accounts Receivable, and Cash Receipts

True/False Questions


1	Special journals are needed when the transactions of a business include groups of repetitive entries.
		A)	True
		B)	False


2	Sales on credit require debits to Accounts Receivable.
		A)	True
		B)	False


3	The Sales account may be credited for a sale only when cash is received.
		A)	True
		B)	False


4	The special sales journal is used for recording both cash sales and sales on credit.
		A)	True
		B)	False


5	The columns and headings in the sales journal eliminate the need for an explanation of each entry.
		A)	True
		B)	False


6	The use of a special sales journal makes posting to accounts in the general ledger unnecessary.
		A)	True
		B)	False


7	The use of a special sales journal enables more than one person to work on the journals of a business at the same time.
		A)	True
		B)	False


8	The larger the volume of credit sales, the more desirable it is to use a special sales journal.
		A)	True
		B)	False


9	The amount of a sales allowance is debited to the Sales account because the revenue from sales has been reduced.
		A)	True
		B)	False


10	When a customer returns goods on which sales tax was charged, the firm gives credit for the price of the goods and the sales tax.
		A)	True
		B)	False


11	The Accounts Receivable account in the general ledger must be individually debited for each credit sale as it is made.
		A)	True
		B)	False


12	The accounts receivable ledger is called a subsidiary ledger because it is only a part of the general ledger.
		A)	True
		B)	False


13	The amount of each credit sale is posted immediately to the customer's account in the accounts receivable ledger.
		A)	True
		B)	False


14	The basic procedure for posting totals from the sales journal to the general ledger is not affected by the use of an accounts receivable ledger.
		A)	True
		B)	False


15	When the balance-form ledger sheet is used in the accounts receivable ledger, the accountant figures the running balance of each account after each posting during the month
		A)	True
		B)	False


16	The Accounts Receivable account in the general ledger is known as a control account because it contains a summary of all activities involving accounts receivable.
		A)	True
		B)	False


17	As proof of accuracy, the accountant prepares a list of all customers` accounts in the accounts receivable ledger and compares the total of the balances with the balance of the Accounts Receivable account in the general ledger.
		A)	True
		B)	False


18	The accountant must keep an individual record of dealings with each customer to answer questions received from managers and salespeople of the company, from the customers themselves, and from banks and credit bureaus.
		A)	True
		B)	False


19	A credit sale made on a credit card issued by a credit card company is accounted for in the same manner as a credit sale made on a bank credit card.
		A)	True
		B)	False

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