BUSINESS ADMINISTRATION
FINANCIAL ACCOUNTING
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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A debit to Cash Received account of $2, 100
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A credit to Accounts Receivable account of $2, 100
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A debt to the Cash account of $1, 400
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A debit to the Accounts Receivable account of $1, 400
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Detailed explanation-1: -An accounts receivable journal entry is the recording of an accounts receivable transaction in the business’s accounting records. It is an essential step in properly documenting this financial activity. Accounts receivable is an accounting term that refers to sales for which payment has not yet been received.
Detailed explanation-2: -Account Receivable is an account created by a company to record the journal entry of credit sales of goods and services, for which the amount has not yet been received by the company. The journal entry is passed by making a debit entry in Account Receivable and corresponding credit entry in Sales Account.
Detailed explanation-3: -Ram is the Receiver of goods, as such, his personal account has been debited According to the rule of personal account, i.e., “Debit the Receiver”. Sales A/c will be credited according to the rule of Nominal account i.e., “Credit all incomes”.
Detailed explanation-4: -Cash Purchase Journal Entry, is the accounting entry made in the books of accounts, to record purchase of goods by paying for it at the time when the goods are acquired . Further, the Purchase could be of an Asset, or trading goods.