17. Statement 1: Unexpended balance of petty cash andchange fund are considered as "cash on hand"Statement 2: Consigned foods although these are within thepremise of our business are excluded in the physicalinventory count.a. Both statements are trueb. Only Statement 1 is truec. Only Statement 2 is trued. Both statements are false18. Statement 1: Liabilities represent the claims of variouscreditors over the Assets of the business.Statement 2: Advance payment made by the customer forundelivered goods is treated as a liability.a. Both statements are trueb. Only Statement 1 is truec. Only Statement 2 is trued. Both statements are false19. Statement 1: Accounts payable is usually called "Tradepayable" because there is a named-payee whenever wemake payment.Statement 2: Owner's Equity is similar to Capital,Proprietorship, Proprietary interest, and Net worth.a. Both statements are trueb. Only Statement 1 is truec. Only Statement 2 is trued. Both statements are false20. Statement 1: Statement of Comprehensive Income waspreviously known as "Income Statement".Statement 2: Statement of Comprehensive Income tells uswhether the business makes profit or incur a loss.a. Both statements are trueb. Only Statement 1 is truec. Only Statement 2 is trued. Both statements are false21. Statement 1: Revenue and Expenses are temporaryaccounts of an Owner's Equity.Statement 2: Revenue and expenses are closed at the end ofthe accounting period.a. Both statements are trueb. Only Statement 1 is truec. Only Statement 2 is trued. Both statements are false 22. Statement 1: Statement of Comprehensive Incomeaccounts are also known as “nominal accounts"Statement 2: The normal balance of Revenue or incomeaccount is credit while the Expense is debit.a. Both statements are trueb. Only Statement 1 is truec. Only Statement 2 is trued. Both statements are false23. Statement 1: Revenue decreases Owner's Equity.Conversely, Expense increases Owner's Equity.Statement 2: Profit and loss are closed to Owner's Equity.a. Both statements are trueb. Only Statement 1 is truec. Only Statement 2 is trued. Both statements are false24. Statement 1: Statement of Comprehensive Income is dated"for the period ended".Statement 2: In the multiple step form of Statement ofComprehensive Income preparation, operating expenses aredirectly deducted from Sales revenue to arrive at Profit.a. Both statements are trueb. Only Statement 1 is truec. Only Statement 2 is trued. Both statements are false25. Statement 1: Service concern usually follows the singlestep form of Income Statement while Merchandisingconcern follows a multi-step form.Statement 2: Operating expenses are classified intofunctional and natural expense.a. Both statements are trueb. Only Statement 1 is truec. Only Statement 2 is trued. Both statements are false26. Statement 1: The revenue that derived from a servicecompany is “Service Revenue", while the revenue derivedfrom Merchandising business is "Sales Revenue"Statement 2: Gross profit is arrive at by deducting Salesfrom Cost of Sales or Cost of Goods sold.a. Both statements are trueb. Only Statement 1 is truec. Only Statement 2 is trued. Both statements are false

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17. Statement 1: Unexpended balance of petty cash and change fund are considered as "cash on hand" Statement 2: Consigned foods although these are within the premise of our business are excluded in the physical inventory count. a. Both statements are true b. Only Statement 1 is true c. Only Statement 2 is true d. Both statements are false

17. Statement 1: Unexpended balance of petty cash and change fund are considered as "cash on hand" Statement 2: Consigned foods although these are within the premise of our business are excluded in the physical inventory count. a. Both statements are true b. Only Statement 1 is true c. Only Statement 2 is true d. Both statements are false

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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17. Which of the following provides a company with an efficient way to handle small payments of cash? a. Petty cash fund b. Bank account c. General reserve d. Allowance for doubtful accounts
37- Promissory notes are not used in one of the following situation a. When the business borrows money b. When the business makes settlement of accounts receivables c. When the business make sales d. When the period of credit exceed the normal limits
9 - Which of the following should be done if there is a shortage of cash and the reason cannot be found that day ? a) It is written to the creditor side of Account 197 Counting and Receipt Deficiencies B) It is written to the creditor side of Account 397 Counting and Receipt Deficiencies NS) 659 Debited for other ordinary expenses D) It is written to the debtor side of the 197 Counting and Receipt Deficiencies Account TO) It is written to the debtor side of Account 397 Counting and Receipt Deficiencies
23.At the end of the accounting period, the petty cash fund/drawer showed petty cash vouchers for expenses paid from the fund that have not been reimbursed. If no adjusting entry is made at year end, a. cash will be understated and expenses will be overstated. b. cash will be overstated and expenses will be understated c. cash and net income will be understated. d. cash and expenses will be overstated.
Q.1.4 Petty cash transactions are defined as any transaction that causes a decrease in the:(a) Cash on hand in the bank account;(b) Cash on hand in the petty cash box;(c) Cash float in the cash register;(d) None of the above.(1) Q.1.5 In“D column is used for: (a) The name of the debtor;(b) The name of the creditor;(c) The name of the contra account where applicable;(d) The name of the owner. Q.1.6 Sold goods on credit to Debtor A Jones for R15 000 (VAT exclusive) less 7.5% trade discount. Which amount will be posted to the sales account?(a) R15 000;(b) R13 875;(c) R12 509;(d) R7 500.Q.1.7 Which one (1)(a) Original credit note;(b) Original credit invoice;(c) Duplicate credit invoice;(d) Duplicate credit note.
Evaluate the following statements Statement 1: Under the punctuating system of petty cash accounting, there will be necessary adjustments at the end of the reporting period at all times. Statements 2: Under the imprest system of accounting for petty cash fund entries for expenses and others are made upon fund replenishment, therefore, entries are not necessary at any point within the reporting period. Statement 3: in the conduct of petty cash count, when you find a check with the petty cash custodian's name on it, it shall be included as a cash item together with the bills and other loose coins. A. TRUE, TRUE, FALSE B. FALSE, FALSE. TRUE C. TRUE, FALSE. FALSE D. FALSE. TRUE, FALSE E. TRUE. FALSE. TRUE
All of the following are documents used for inventory control except Oa. a receiving report. Ob. a petty cash voucher Oc. a vendor's invoice.
Which of the following is correct regarding accrual basis of accounting? a. No bad debts are recognized because trade receivables are not recognized. b. Accrual sales is equal to cash sales plus collection of trade receivables. c. Accrual purchases is equal to cash purchases less purchases on account. d. Doubtful accounts are treated as bad debts.
18 The cash balance prior to reconciliation is called as __________________. a. Petty cash balance b. Reconciled cash balance c. Unreconciled cash balance d. None of the given options Clear my choice