Cash Payments Journal: Cash Payments Journal is used to record all cash payments made by the business. Few examples of cash payments are as follows: • Cash purchases of goods, services, equipment or any other asset. • Payment to Creditors. • Cash refunds to customers for the return of goods sold for cash. • Cash payments for expenses such as Rent, Salaries, Wages, Interest, Taxes etc. • Drawings made by the proprietor. To indicate: The posting process of Cash Payments Journal

Question

Want to see the full answer?

Answer 1

Question

Chapter 7, Problem 11RQ

To determine

Cash Payments Journal: Cash Payments Journal is used to record all cash payments made by the business. Few examples of cash payments are as follows:

• Cash purchases of goods, services, equipment or any other asset.

• Payment to Creditors.

• Cash refunds to customers for the return of goods sold for cash.

• Cash payments for expenses such as Rent, Salaries, Wages, Interest, Taxes etc.

• Drawings made by the proprietor.

To indicate:

The posting process of Cash Payments Journal

Expert Solution & Answer

Want to see the full answer?

Check out a sample textbook solution

See solution

Students have asked these similar questions

No wrong solution

Zanzibar Limited entered into a lease agreement on July 1 2016 to lease some highly customized hydraulic equipment to Kaizen Limited. The fair value of the equipment as at that date was $700,000. The terms of the lease agreement were: Lease term Equipment economic life Annual rental payment, in arrears (commencing June 30th 2017) Equipment residual value Guaranteed residual value by Zanzibar Incremental borrowing rate 5 years 6 years $160,000 $100,000 $60,000 8% Interest rate implicit in the lease 6% Note: the lease is cancellable but only with Zanzibar's permission At the end of the lease term, the equipment is to be returned to Zanzibar Limited. On July 1, 2016, Zanzibar incurred $12,000 in legal fees for setting up the lease. The annual rental payment includes $10,000 to reimburse the lessor for maintenance fees incurred on behalf of the lessee. Requirements: a) Discuss the nature of the lease using the appropriate criteria. Justify your answer using calculations where applicable b)…

Repsola is a drilling company that operates an offshore Oilfield in Feeland. Five years ago, Feeland had a major oil discovery and granted licenses to drill oil to reputable, experienced drilling companies. The licensing agreement requires the company to remove the oil rig at the end of production and restore the seabed. Ninety percent of the eventual costs of undertaking the work relate to the removal of the oil rig and restoration of damage caused by building it and ten percent arise through the extraction of the oil. At the Statement of Financial Position (SOFP) date (December 31 2025), the rig has been constructed but no oil has been extracted On January 1st 2023, Repsola obtained the license to construct an oil rig at a cost of $500 million. Two years later the oil rig was completed. The rig is expected to be removed in 20 years from the date of acquisition. The estimated eventual cost is 100 million. The company's cost of capital is 10% and its year end is December 31st. Repsola…