Correct Answer:
D. Debit Accounts Receivable, Credit Sales
Receivables (an asset) increase by debit and sales (revenue) increases by credit.
November 13, 2026 · Accounting and Finance MCQs, Financial Accounting MCQs
The journal entry for goods sold on credit is:
Related MCQs
Purchase of equipment for cash is classified as a cash flow from:
A.
Investing activities
B.
Operating activities
C.
Financing activities
D.
It is not a cash flow
Correct answer is:
A. Investing activities
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Under the direct write-off method, when a specific receivable is written off as bad:
A.
Accounts receivable is debited and sales is credited
B.
Cash is debited and receivables is credited
C.
Bad debt expense is debited and accounts receivable is credited
D.
Allowance for doubtful debts is debited and cash is credited
Correct answer is:
C. Bad debt expense is debited and accounts receivable is credited
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Which of the following is NOT a component of internal control in the COSO framework?
A.
Audit sampling
B.
Control environment
C.
Risk assessment process
D.
Monitoring of controls
Correct answer is:
A. Audit sampling
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An appropriation account compares:
A.
Profit with loss
B.
Assets with liabilities
C.
Tax collected with tax assessed
D.
Actual expenditure with the grants or appropriations authorized by the legislature
Correct answer is:
D. Actual expenditure with the grants or appropriations authorized by the legislature
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Activity-based costing (ABC) assigns overhead costs to products on the basis of:
A.
A single plant-wide rate based on labor hours only
B.
Activities that consume resources, using cost drivers
C.
Selling price
D.
Number of employees
Correct answer is:
B. Activities that consume resources, using cost drivers
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Under the accrual basis of accounting in the public sector, transactions are recognized when:
A.
Cash is received only
B.
Cash is paid only
C.
They occur, regardless of when cash is received or paid
D.
The budget is approved
Correct answer is:
C. They occur, regardless of when cash is received or paid
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