Chapter 6 - The Journal and HST
Define what a contra account is?
An account that reduces or offsets the balance of a related account
Where are posting references done?
In the posting reference column of a Journal or Ledger
This type of account closes at the end of a fiscal period.
Nominal/Temporary
What country gifted the United States the Statue of Liberty
France
Why is posting done?
To uphold the objectivity principle
The term “remit” is used to describe: HST payable, HST recoverable or both?
Both, if HST Recoverable > HST Payable, the government pays you the remittance. If HST Payable> HST Recoverable, you pay government remittance
How is posting done in the Journal? Provide an example
Reference the appropriate ledger account. “101”
Out of the 4 types of adjusting entries, list 2
Supplies, prepaid expenses, Late arriving purchase invoices, unearned revenue
How many minutes is a game of rugby?
80 minutes
How are drawings accounts closed?
Debit Capital, Credit Drawings
What is illustrated in the following image?
Purchase invoice
How is posting done on the ledger? Provide an example.
A capital J is followed by the page number. “J12”.
This type of accounting recognizes income when it earned, but not necessarily received
Accrual Accounting
What country would you find the River Thames in?
United Kingdom
What is the reason that some accounts remain open and some close at the end of a fiscal year?
Some accounts are ongoing such as assets, liabilities and capital while some are not. Ex. If an A/P is not paid in the fiscal period, it simply cannot disappear.
Out of HST payable and HST receivable, which of the following is a Contra/Valuation account?
HST Recoverable
Fill in the blanks: posting is the process of transferring the accounting entries from the ____ to the ____
Journal, Ledger
What are Real Accounts?
Permanent accounts that are not closed.
Who was considered to be the father of accounting
Luca Pacioli
What are three reasons for adjusting entries? (Hint: three words)
So information on financial statements is relevant, reliable, and comparable.
Fill in the blank: any business with a sales of taxable goods and services of $_____ is required to complete HST registration
30 000
What is created after posting (Hint: it may or may not be an OFFICIAL financial document)
The trial balance, to check if the ledger is correct
List all the accounts that are closed at the end of a fiscal period.
Revenue, Expense, Income Summary, Capital, Drawings
How long does light take to reach the earth from the sun ( “X” minutes and “Y” seconds)?
8 minutes 20 seconds
What are the five types of journals?
General, Cash Receipts, Cash Payment, Sales, and Purchase are five types of Journals