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Practice mode Accounting

What is the purchases journal used to record?

Correct answer B. All credit purchases of goods

Explanation

The purchases journal records only credit purchases of goods meant for resale; cash purchases go to the cash book and credit purchases of assets go to the journal proper.

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Question 03 Accounting

While closing the current year’s accounts, a company finds that last year’s closing stock was overstated by 50,000. What is the result?

Correct answer C. Previous year‘s profit is overstated and current year‘s profit is understated

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Question 04 Accounting

Which statement about the trial balance is correct?

Correct answer A. The Trial Balance has no statutory importance from the point of view of law

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