Exam 5: Accounting Systems

An "Accounts Receivable Customer Balances" report shows

Which of the following transactions is recorded in the revenue journal?

The following are selected transactions related to purchases on account and cash payments completed during April of the current year.Apr. 1 Issued Check No. 60 in payment of rent for month, $2,400. 5 Purchased office supplies from Clauson Co., $850. 9Issued Check No. 61 to Dame Co. for $9,750 for cash purchase of equipment. 10Purchased store supplies from Ewing Co., $425. 15Issued Check No. 62 to Clauson Co. in payment of April 5 invoice. 17Purchased store supplies from Patton Co., $7,500. 20Issued Check No. 63 to Ewing Co. in payment of April 10 invoice of $425. 25Purchased equipment from Sloan Co., $7,750. 27Issued Check No. 64 to Patton Co. for partial payment of the April 17 invoice, $4,000. 30Purchased office supplies from Winthrop Co., $400.? (a)Record the transactions in the purchases and cash payments journals. (b)Total and rule the purchases and cash payments journals as of April 30. (c)Indicate the method of posting the individual items and the totals of the purchases and cash payments journals in the following manner: (1)For individual items and totals to be posted to the subsidiary ledger or not to be posted, insert a check mark in the Post. Ref. column or below the totals. (2)For individual items and totals to be posted to the general ledger, insert the letter "G" (as a substitute for specific account numbers) in the Post. Ref. column or below the totals.? \quad\quad\quad\quad\quad\quad\quad\quad\quad\quad CASH ~PAYMENTS~ JOURNAL\quad\quad Page~ 11\\ \begin{array}{c} \hline &&&&\text { Other }&\text { Accounts } \\ & \text { Ck. } & \text { Account } & \text { Post. }&\text { Accounts }&\text { Payable } & \text { Cash } \\ \underline {\text { Date }} & \underline {\text { No. }} & \underline {\text { Debited }} & \underline {\text { Ref. }} & \underline {\text { Dr. }} & \underline {\text { Dr. }} & \underline {\text { Cr. }} \\ \end{array} \quad\quad\quad\quad\quad PURCHASES ~JOURNAL\quad\quad\quad\quad\quad Page 22\\ \begin{array} { l c c c c } \hline & \text { Account } & \text { Post. } & \begin{array} { c } \text { Accounts } \\ \text { Payable } \end{array} & \begin{array} { c } \text { Store } \\ \text { Dupplies } \end{array} \\ \underline {\text { Date }} & \underline { \text { Credited } } & \underline { \text { Ref. } } & \underline {\text { Cr. } }& \underline { \text { Dr. } } \end{array} Office Other Supplies Accounts Post.

The methods and procedures for collecting, classifying, summarizing, and reporting a business's financial and operating information are called the accounting system.

The following purchase transactions occurred during August for Backcountry Kayak Excursions.Aug. 1Purchased Kevlar kayaks (equipment) for $5,600 on account from Gear Inc.6Purchased kayak paddles (supplies) for $3,250 on account from Southland Co.14Purchased life vests (supplies) for $2,500 on account from Gear Inc.?Record these transactions in a purchases journal.

Month-end postings to control accounts in a computerized accounting system are not required because

The use of subsidiary ledgers is limited to Accounts Payable and Accounts Receivable.

When posting column totals in the purchases journal, a credit should be posted to

A basic manual accounting system includes all of the following except a

E-commerce provides additional business opportunities but at the cost of reduced speed and efficiency.

The revenue journal is designed for the efficient recording of cash sales transactions.

In a computerized accounting system, all postings happen automatically at the end of the month.

A cash refund paid to a customer who overpaid an account receivable is recorded in the cash payments journal.

A cash purchase of supplies should be recorded in the

$\text { Match the transactions below with the journal or ledger in which it would be entered. }$ -Monthly adjustment for supplies used a. Purchases journal b. Revenue journal c. Cash receipts journal d. Cash payments journal e. Accounts receivable subsidiary ledger f. Accounts payable subsidiary ledger g. General journal

A purchase of supplies on account is recorded in the

Computerized accounting systems prevent all journalizing errors.

Processing methods

$\text { Match each subsidiary ledger and general ledger posting to one of the descriptions of activities } ( a - e ) \text {. }$ -No subsidiary ledger posting a. Purchases on account b. Collections from customers on account c. Adjustment for expired insurance d. Payments to creditors on account e. Sales on account

A cash investment made by the owner should be recorded in the