Recording Cash Transactions

Question 1

What is the only real difference between cash invoice and credit invoice?

Answer 1

Cash invoice must indicate the customer paid for the goods at point of sale.

Question 2

What is a cash slip?

Answer 2

An abridged tax invoice that may be used for sales not exceeding R5000

Question 3

When should a cash receipt be issued?

Answer 3

When no VAT should be charged.

Question 4

What does a petty cash voucher record?

Answer 4

Payments made out of the petty cash box.

Question 5

What is a journal voucher?

Answer 5

An internal source document from which transactions are recorded in the GJ

Question 6

What is recorded in the CRJ?

Answer 6

Any transactions that cause the balance of the current bank to to increase.

Question 7

What is recorded in the CPJ?

Answer 7

Any transactions that cause the balance of the current bank account to decrease.

Question 8

What is recorded in the PCJ?

Answer 8

Purchases from the petty cash box.

Question 9

What is recorded in the CJ

Answer 9

Credit purchases of any product or service.

Question 10

What is recorded in the CAJ?

Answer 10

Returns / rebates with regard to transactions previously entered into the CJ.

Question 11

What is recorded in the DJ?

Answer 11

Credit sales of trading inventory only.

Question 12

What is recorded in the DAJ?

Answer 12

Returns / rebates with regard to transactions previously entered into the DJ.

Question 13

What is recorded in the GJ?

Answer 13

Sundry transactions that cannot be recorded in any of the above seven journals?

Question 14

What is a book of prime entry?

Answer 14

A book onto which source documents are recorded / summarised.

Question 15

What are the components of the cashbook?

Answer 15

The CRJ and CPJ.

Question 16

What is a cash transaction?

Answer 16

A transaction that is settled at the point of sale.

Question 17

What is the analysis of receipts column?

Answer 17

The column where cash amounts that pass through the register are entered into so that the bank column can accurately reflect the account by the deposit slips.

Question 18

What is in a journal’s header?

Answer 18

Journal’s name, applicable month and journal reference number

Question 19

What is in the GL heading?

Answer 19

General ledger of (business name)

Question 20

Where are the references for each account located in the GL?

Answer 20

Centred above the folio column.

Question 21

How does balancing an account work if there is only one posting?

Answer 21

No balancing is necessary since the total is plain to see.

Question 22

Hoe does balancing an account work if there are multiple postings one only one side?

Answer 22

The side with the postings can simply be totalled.

Question 23

How does balancing an account work if there are multiple entries on both sides?

Answer 23

The expected greatest side is summed first. This total is then transposed to the other side.
The balance carried down is then calculated by means of calculating the difference between the totals on this side. This total is then brought down to the original side of the account and used as the opening balance for the first day of the month.

Question 24

What accounts will always have a debit balance?

Answer 24

Assets, expenses and the drawings accounts

Question 25

What accounts will always have a credit balance?

Answer 25

Liabilities, income and capital accounts.

Question 26

What is a trial balance?

Answer 26

An index of accounts used to reflect the debit or credit balance for every account.

Question 27

How is the trial balance divided?

Answer 27

Statement of financial position section (i.e., all asset, liability and proprietary account balances).
Nominal accounts section.