General Journal
Which of the following best describes the trade discount:
It is different from cash discount
It is a reduction in list (or retail) price
It is not recorded in the books
All of the above
All of the above
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The column of the journal used to record the page number of the ledger account is known as:A. Referring column
B. Posting reference
C. Entry number
D. Ledger number
The cash discount given is debited because it is:
A. A revenue of the business
B. An expense of the business
C. A liability of the business
D. An asset of the business
The cash discount received is credited because it is:
A. A liability
B. An expense
C. An asset
D. An income
The correct entry for the sale of merchandise on account is:
A. Accounts Receivable > Debit; Profit > Credit
B. Cash > Debit; Sales > Credit
C. Accounts Receivable > Debit; Asset > Credit
D. Accounts Receivable > Debit; Sales > Credit
The term used for the discount offered by sellers to encourage prompt payments is known as:
A. Trade discount
B. Relationship discount
C. Payment discount
D. Cash discount
A journal entry that involves more than two accounts is called:
A. Double entry
B. Compound entry
C. Combined entry
D. Complex entry
The process of recording business transactions in chronological order is called:
A. Recording
B. Posting
C. Journalizing
D. Classifying
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