Tag: purchase book or purchase journal

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Questions Related to purchase book or purchase journal

Multiple choice elements of book keeping and accountancy sub-division of journal - 2 (subsidiary books) explain the importance of preparing subsidiary books meaning and advantages of subsidiary books purchase book or purchase journal

The source document required for recording transactions in Purchase Return Book.

  1. Debit note

  2. Credit note

  3. Cash memo

  4. Credit memo
Reveal answer Fill a bubble to check yourself
A Correct answer
Explanation

When the goods are returned a debit note is prepared and is sent to the supplier with the returned goods. An original copy is sent to the supplier, informing him of the amount for which his account has been debited on account of the returned goods. A duplicate copy of the debit note becomes the source document, on the basis of which entries are recorded in the purchase return book. Thus a debit note is required for recording the transactions in the Purchase return book.

Multiple choice elements of book keeping and accountancy sub-division of journal - 2 (subsidiary books) explain the importance of preparing subsidiary books meaning and advantages of subsidiary books purchase book or purchase journal

In the purchase book, the record is in respect of _________.

  1. Cash purchase of goods

  2. Credit purchase of goods dealt in

  3. All purchases of goods dealt in

  4. None of these
Reveal answer Fill a bubble to check yourself
B Correct answer
Explanation

The purchase book is exclusively used to record credit purchases of goods that the business deals in for resale.

Multiple choice elements of book keeping and accountancy sub-division of journal - 2 (subsidiary books) explain the importance of preparing subsidiary books meaning and advantages of subsidiary books purchase book or purchase journal

Mr. N returns the goods of  50,000 purchased on credit to Mr. Z. This transaction will recorded by Mr. N in ______ and by Mr. Z in ______.

  1. Sales Return Book, Purchases Return Book

  2. Purchases Return Book Sales Return Book

  3. Sales Return Book, Sales book

  4. Purchases Return Book, Purchase Book
Reveal answer Fill a bubble to check yourself
B Correct answer
Explanation

This is identical to question 407389. Mr. N (buyer) records in Purchases Return Book, and Mr. Z (seller) records in Sales Return Book. Option B has a minor spacing issue but is clearly the correct answer.

Multiple choice elements of book keeping and accountancy sub-division of journal - 2 (subsidiary books) explain the importance of preparing subsidiary books meaning and advantages of subsidiary books purchase book or purchase journal

Sales day book is the summary of both cash and credit sales of the concern.

  1. True

  2. False
Reveal answer Fill a bubble to check yourself
B Correct answer
Explanation

Sales day book is the summary of only credit sales of goods taken place by the firm, cash sales are entered in the Cash Book and not in the Sales book.

Multiple choice elements of book keeping and accountancy sub-division of journal - 2 (subsidiary books) explain the importance of preparing subsidiary books meaning and advantages of subsidiary books purchase book or purchase journal

State with reasons whether the following statement is true or false:
The Purchase Day Book is a part of the ledger.

  1. True

  2. False
Reveal answer Fill a bubble to check yourself
B Correct answer
Explanation

The Purchase Day Book is a book of original entry (journal), not a ledger. Ledgers are books of final entry.

Multiple choice elements of book keeping and accountancy sub-division of journal - 2 (subsidiary books) explain the importance of preparing subsidiary books meaning and advantages of subsidiary books purchase book or purchase journal

State with reasons whether the following statement is true or false:
Purchase Book records all purchases of goods.

  1. True

  2. False
Reveal answer Fill a bubble to check yourself
B Correct answer
Explanation

The Purchase Book only records credit purchases of goods. Cash purchases are recorded in the Cash Book.

Multiple choice elements of book keeping and accountancy sub-division of journal - 2 (subsidiary books) explain the importance of preparing subsidiary books meaning and advantages of subsidiary books purchase book or purchase journal

State with reasons whether the following statement is true or false:
The Sales Day Book is a part of ledger. 

  1. True

  2. False
Reveal answer Fill a bubble to check yourself
B Correct answer
Explanation

The Sales Day Book is a book of original entry (journal), not a ledger.

Multiple choice elements of book keeping and accountancy sub-division of journal - 2 (subsidiary books) explain the importance of preparing subsidiary books meaning and advantages of subsidiary books purchase book or purchase journal

State with reasons whether the following statement is true or false:
Purchase Books records all the credit purchase of goods.

  1. True

  2. False
Reveal answer Fill a bubble to check yourself
A Correct answer
Explanation

The Purchase Book is specifically designed to record all credit purchases of goods dealt in by the business.

Multiple choice elements of book keeping and accountancy sub-division of journal - 2 (subsidiary books) explain the importance of preparing subsidiary books meaning and advantages of subsidiary books purchase book or purchase journal

State with reasons whether the following statement is true or false:
The sales-Book is kept to record both cash and credit sales.

  1. True

  2. False
Reveal answer Fill a bubble to check yourself
B Correct answer
Explanation

The Sales Book only records credit sales. Cash sales are recorded in the Cash Book.

Multiple choice elements of book keeping and accountancy sub-division of journal - 2 (subsidiary books) explain the importance of preparing subsidiary books meaning and advantages of subsidiary books purchase book or purchase journal

Under sales or return on approval basis, when the transactions are few and the customer accepts the goods on approval or return basis, the accounting treatment will be __________________.

  1. No Journal Entry

  2. Entry in Sales or Return Journal

  3. Entry in Sales or Return Day Book

  4. Sundry Debtors A/c Dr.

    To Sales A/c
Reveal answer Fill a bubble to check yourself
A Correct answer
Explanation

No Entry is made, as it has been already recorded as sales when the goods were sent to customer.