chapter 2 theory

Question 1

Cash transactions-

Answer 1

Payment is made immediately when goods are sold, or services are provided.

Question 2

Credit transactions-

Answer 2

Payment for goods or services is delayed to an agreed-upon future date.

Question 3

What is accounting cycle?

Answer 3

An accounting cycle is the processing of accounting transactions through the accounting information system.

Question 4

What are the 4 stages of the accounting cycle?

Answer 4

identifying and recording, adjusting, reporting and closing

Question 5

identifying and recording

Answer 5

recorded daily

Question 6

adjusting

Answer 6

adjusted at least once in a financial year

Question 7

reporting

Answer 7

reports are prepared at least once in a financial year

Question 8

closing

Answer 8

accounts are closed at the end of the year

Question 9

keyword payment (cash or cheque)

Answer 9

source document receipt

Question 10

keyword on credit

Answer 10

source document invoice

Question 11

keyword overcharged or return
COconut

Answer 11

source document credit note

Question 12

keyword undercharge
DUrian

Answer 12

source document debit note

Question 13

keyword specific invoice

Answer 13

source document remittance advice

Question 14

keyword salary expense/ payment/ when business pays the supplier

Answer 14

source document payment voucher

Question 15

keyword bank/ related to bank

Answer 15

source document bank statement