Chapter 1, Problem 3AP

MULTIPLE CHOICE 1. This process refers to the reporting of the information processed in the accounting system to interested users. A. Journalizingh B. Communicating C. Debiting D. Videoing 2. What is the normal balance of the sales returns account? A. Zero B. Credit C. Debit D. None of these

Multiple choice: 1. Which of the following statements regarding accounting is incorrect? A. All business transactions and events are recorded in the accounting books. B. Although bookkeeping and accounting are interrelated, they are not the same. C. A transaction or event is recorded in the accounting records only if it has an effect on the assets, liabilities, equity, income or expenses of the business. D. The purpose of accounting is to provide information that is useful in making economic decisions. 2. Sales revenue minus sales returns and allowances and sales discounts equals: A. Net sales B. Income from operations C. Gross margin D. Cost of goods sold

Application Problem Journalizing transactions that affect owner’s equity and receivingcash on account in a multicolumn journal LO3, 4, 5, 6, 7Use the chart of accounts given in Problem 3-1 and the journal from Problem 3-2.Transactions:Mar.12. Paid cash for rent, $400.00. C6.13. Received cash from sales, $250.00. T13Mar.14. Sold services on account to Scott Company, $225.00. S1.15. Paid cash for telephone bill, $190.00. C7.15. Paid cash to owner as withdrawal of equity, $1,400.00. C8.18. Received cash from sales, $130.00. T18.19. Paid cash for postage (Miscellaneous Expense), $32.00. C9.21. Received cash on account from Scott Company, $125.00. R2.22. Received cash from sales, $350.00. T22. 22. Paid cash for heating bill, $165.00. C10.25. Bought supplies on account from Supply Mart, $170.00. M2.Instructions:1. Journalize the transactions completed during March of the current year. Sourcedocuments are abbreviated as follows: check, C; memorandum, M; receipt, R;2. Save your work to complet