Multiple Choice Questions:

13.The balance day adjustment to make an allowance for doubtful debts is:

A.Dr bad debts expense; Cr allowance for bad debts.

B.Dr bad debts expense; Cr allowance for doubtful debts.

C.Dr allowance for doubtful debts; Cr doubtful debts expense.

D.Dr allowance for bad debts; Cr bad debts expense.

14.All cash payments are recorded in:

A.Sales Journal

B.Cash Payments Journal

C.Cash Receipts Journal

D.General Journal

15.Which of the following statements is false with regard to a Cash Receipts Journal?

A.All receipts of cash from customers should be recorded in it

B.Receipts of cash from the owner should not be recorded in it

C.Receipt of cash from cash sales should be recorded in it.

D.Receipt of cash from borrowing should be recorded in it.

16.On balance day, a physical inventory count and cost was $10,250, and the market value of inventory was $10,180. At what figure will the inventory be shown in the balance sheet?

A.$10,250

B.$10,180

C.$10,215

D.None of the above.

17.When preparing a bank reconciliation statement and the closing bank statement balance is an overdraft, we begin with the balance in the bank statement and then:

A.add unpresented cheques and deduct outstanding receipts.

B.add outstanding receipts and deduct unpresented cheques.

C.add all receipts and deduct all payments.

D.add all payments and deduct all receipts.

18.The difference between the bank statement balance and the balance in Bank account in the general ledger may be due to:

A.unpresented payments.

B.outstanding receipts.

C.errors done by the bank and the entity.

D.all of the choices given.

19.Adjusting entries are recorded:

A.only on the work sheet.

B.only in the general ledger.

C.only in the general journal.

D.in any of the special journals.

20.The balance in the profit and loss account is transferred to the:

A.profit and loss account.

B.capital account.

C.bank account.

D.drawings account.