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Exam 8: Accounting for Purchases and Accounts Payable

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Question 1

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Check marks next to the individual amounts in the purchases journal mean that the amounts

A) have been posted to the general ledger.
B) have been posted to the accounts payable subsidiary ledger.
C) have been posted to the accounts receivable subsidiary ledger.
D) do not need to be posted to any account.

E) A) and D)
F) B) and C)

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Question 2

Multiple Choice

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Freight charges on merchandise purchases should be debited to

A) the Purchases account.
B) the Accounts Payable account.
C) the Freight In account.
D) the creditor's account in the subsidiary ledger.

E) B) and C)
F) A) and D)

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Question 3

Multiple Choice

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Hugh Snow returned merchandise to Farley Co.The entry on Hugh Snow's books to record the return of merchandise to Farley Co.would include a:

In a firm that uses special journals,the receipt of a credit memorandum from a supplier for merchandise that was damaged but can be sold at a reduced price is recorded in the

No amounts are posted from the purchases journal to the accounts payable subsidiary ledger during the month.

The amount of the purchases for a period is presented in

A purchase of merchandise for cash should be recorded in the purchases journal.

Which of the following accounts has a normal debit balance?

The journal entry to record the purchase of merchandise on account for $2,750 with freight of $125 prepaid by their supplier and added to the invoice is:

The supplier's invoice is the source document for a purchase on credit transaction.

In a firm that uses special journals,the return of damaged merchandise to a supplier and receipt of a credit memorandum is recorded in the

After a supplier of merchandise is selected,the purchasing department issues a form called

Read the description of the following transactions that are recorded during the accounting period for Drummond Consulting Services.Determine the account to be debited and the account to be credited. A)Purchased merchandise with terms of net 30 days. B)Returned some damaged merchandise to a supplier and received a credit memorandum. C)Issued a check to a supplier as a payment on account. D)Received an allowance for some merchandise that was slightly damaged but can be sold at a reduced price.Received a credit memorandum. E)Purchased merchandise with terms of 2/10,n/30.The supplier's invoice includes a freight charge.

A creditor's account in the accounts payable ledger has a $1,600 beginning balance.After a transaction for $700 is posted from the purchases journal,the balance of the creditor's account is

A firm had purchases of $16,200,freight charges of $300,and purchases returns and allowances of $1,100 during one month.Its net delivered cost of purchases was

At the end of February 2016 and before the purchases journal was posted,selected general ledger account balances for Volter Repair Services were as follows (each account had a normal balance): The purchases journal had the following totals: Purchases,$28,000;Freight In,$1,000;Accounts Payable,$29,000. Calculate the ending balance of each of the three accounts after the posting from the purchases journal.Indicate whether each balance is a debit or credit.

For each of the transactions listed below,identify the journal that should be used to record the transaction.Use CR for cash receipts journal,CP for cash payments journal,S for sales journal,P for purchases journal,and G for general journal.

Explain each of the following credit terms. A)n/30 B)n/10 EOM C)2/10,n/30 D)1/10,n/20 E)3/5,n/30

Skiing International uses a perpetual inventory system when recording its purchases and sales of inventory.If the business purchases $8,000 of goods on account,select the correct entry to record the purchase:

When the sales department needs goods,it sends the purchasing department a form called