What are the primary components within an accounting information system?
Heidi Company uses a Sales Journal, a Purchases Journal, a Cash Receipts Journal, a
Cash Disbursements Journal, and a General Journal. The following are the totals from
the special journals for the month ended July 31:
Describe the posting process for special journals.
Posting to special journals is a three-step process: (1) individual amounts in the Other
Accounts column are posted to their general ledger accounts on a regular (daily) basis,
(2) individual amounts in a column that are posted in total to a controlling account at
the end of a period are posted regularly (daily) to the appropriate account in the
subsidiary ledger, and (3) total amounts for all columns except the Other Accounts
column are posted at the end of a period to the appropriate account for each column.
Match each of the following terms with the appropriate definition.
An employee is ________________ when a company purchases an insurance policy
against losses from theft by that employee.
Match the following terms with the appropriate definition.
Identify each of the following accounts as a revenue, expense, asset, liability, or equity
by placing initials (R, E, A, L or E) in the blanks.
_____ (1) Rent Expense
_____ (2) Cash
_____ (3) Equipment
_____ (4) Owner, Capital
_____ (5) Fees Earned
_____ (6) Accounts Receivable
_____ (7) Accounts Payable
_____ (8) Owner, Withdrawals
_____ (9) Supplies
_____ (10) Unearned Revenue
_____ (11) Prepaid Insurance
_____ (12) Sales
Abercrombie Company uses a periodic inventory system and four special journals:
Purchases, Sales, Cash Receipts, and Cash Disbursements. The following transactions
were incurred during August:
___________________ is an account used only in the closing process.
During the current year, Carter Company reported $600,000 in sales, and purchased
merchandise that cost $384,000. The company’s beginning inventory and ending
inventory was $60,000. Calculate the gross profit ratio.