Accounting chapter 11

size, number of transactions, and type of transaction

A business's ____, _____, and ____ determine the number of ledgers used in an accounting system.

true

A change in the balance of a vendor account also changes the balance of the controlling account Accounts Payable.

true

A controlling account balance in a general ledger must equal the sum of all account balances in subsidiary ledger.

true

A diagonal line in the Post. Ref. column allows the posting reference of two account numbers.

A

A form in the accounts receivable ledger has A. a Debit Balance column B. a Credit Balance column C. both Debit Balance and Credit Balance columns D. none of these

Subsidiary Ledger

A ledger that is summarized in a single general ledger account

Accounts Receivable Ledger

A subsidiary ledger containing only accounts for charge customers

Accounts Payable Ledger

A subsidiary ledger containing only accounts for vendors from whom items are purchased or brought on account

true

Amounts in general amount columns of a CR Journal are posted individually to the general ledger account named in Account Title column.

Controlling Account

An account in a general ledger that summarizes all accounts in a subsidiary ledger

false

Daily general ledger account balances are necessary for business.

true

Entries in a general journal may affect account balances in an accounts payable ledger.

false

Errors made in recording amounts in subsidiary ledgers always affect the general ledger controlling account.

General Ledger

Has controlling accounts that summarizes all accounts in a subsidiary ledger.

B

When a credit is posted to the accounts payable ledger, the A. source document number and page number of the journal are written in the Post. Ref. column of the account B. previous balance is added to the new amount posted in the Credit column C. credit amount is written in the Debit column of the account D. word "Balance" is written in the Item column

A

When a debit is posted to the accounts payable ledger, the A. debit amount is written in the Debit column of the account B. cash account increases C. controlling account is increased by the entry D. all of the above

B

When all lines have been used in a ledger account form, a new page is prepared with the account name, account number, and A. page number B. account balance C. company name D. none of these

true

When using an account receivable ledger, the total amount due from all customers is summarizes in a single general ledger account.

vendor account; controlling account

When the balance of a ______ in an AP ledger is changed, the balance of the ____ in the general ledger is affected.

true

Accounts are arranged in alphabetical order within the subsidiary ledgers.

true

Journal entries are sorted and summarized by transferring information to ledger accounts.

name; number

Open vendor accounts by writing ____ and ____.

true

Posting frequently keeps each vendor account balance up to date.

General Ledger

Sorts and summarizes all information affecting Income Statement and Balance Sheet accounts

at the end of the month

Special amount column totals are posted ______.

Accounts Payable Ledger

Summarizes the total amount owed to all vendors.

true

The amount on each line of a purchases journal is posted as a credit to a vendor account in the accounts payable ledger.

true

The balance of the controlling account AP equals the total of all vendor account balances in the AP subsidiary ledger.

true

The form used in the accounts receivable ledger has a Debit Balance column.

A

The journal that should be posted first is the A. sales journal B. purchases journal C. general journal D. cash payments journal

true

The monthly total of each special amount column in a cash payments journal is posted to a general ledger account.

false

The number of entries that may be recorded on each ledger account form is limited to fifteen.

true

The number of transactions determines how often to post.

B

The separate amounts in the Accounts Receivable Debit column of a sales journal are A. posted individually to the general ledger B. posted individually to the accounts receivable ledger C. not posted to the general ledger D. none of these

false

The steps for posting a journal entry to correct customer accounts are exactly the same as posting other transactions to subsidiary ledgers.

C

The total amount of the purchases journal is posted to the general ledger A. daily B. weekly C. at the end of the month D. none of these

true

The total amount owed to all vendors is summarized in a single general ledger account, Accounts Payable.

A

The total of all customer account balances in the accounts receivable ledger equals A. the balance in the accounts receivable controlling account B. the balance in the accounts payable controlling account C. the cash account D. none of these

general ledger

The total of the schedule of AR should equal the AR account balance in the ______.

Accounts Receivable Ledger

Total due from all customers is summarized in a single general ledger account.

true

Transactions recorded in a general journal can affect both subsidiary ledger and general ledger accounts.

false

A change in the balance of a customer account does not affect the balance of the controlling account Accounts Receivable.

C

A check mark is placed in parentheses below the General Debit and General Credit column totals in the journal to indicate that the two column totals are A. posted individually B. posted only as part of the column total C. not posted D. none of these

Schedule of Accounts Receivable

A listing of customer accounts, account balances, and total amount due from all customers

Schedule of Accounts Payable

A listing of vendor accounts, account balances, and total amounts due all vendors

false

A schedule of accounts payable is prepared before all entries in a journal are posted.

false

Each amount in the General columns of the cash payments journal is posted as a total at the end of the month.

false

Each amount in the sales journal's Accounts Receivable Debit column is posted as a credit to the customer account in the accounts receivable ledger.

true

Each entry in the AP columns of the CP journal affects the vendor named in the Account Title column.

true

Each entry in the Accounts Receivable Credit column of the cash receipts journal is posted to the proper customer account in the accounts receivable ledger.

D

Errors in posting may cause A. income to be understated or overestimated on the income statement B. a business to pay too much to a vendor C. cash on hand to be less than the balance in the cash account D. all of the above

true

The accounts receivable ledger is proved when the balance of Accounts Receivable in the general ledger is the same as the total of the schedule of accounts receivable.