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College Accounting, Chapters 1-27

23rd Edition
HEINTZ + 1 other
ISBN: 9781337794756

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Chapter
Section
BuyFindarrow_forward

College Accounting, Chapters 1-27

23rd Edition
HEINTZ + 1 other
ISBN: 9781337794756
Textbook Problem

LO3 In the cash receipts journal, each amount in the General Credit column is posted

  1. (a) daily.
  2. (b) weekly.
  3. (c) at the end of the month.
  4. (d) at the end of the year.

To determine

Find the correct option that indicates each amount in the general credit column is posted (in the cash receipts journal).

Explanation

Cash Receipts Journal:  It is a special book where only cash receipts transactions that are received from customers, merchandise sales and service made in cash and collection of accounts receivable are recorded.

The following are the some examples of transactions that would be recorded in the Other Accounts credit column of the cash receipts journal:

  • Cash received as interest on notes payable
  • Interest revenue received from debtors
  • Cash receipts from bank loans
  • Cash receipts for capital investments

Justification for correct answer: Cash receipts are the regular transactions in most of the businesses. Cash receipts include collections from cash sales, credit sales, and credit card sales. Cash receipts are posted daily to the customer account...

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