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GCE Financial Accounting 1989 Question 4

Question 4

Double Entry and the Ledger

The Sales Account is written up from

  1. A.cash sales to customers only
  2. B.credit sales to customers only
  3. C.credit sales less cash sales
  4. D.cash sales less cash discounts
  5. E.both credit and cash sales.
Show the answer and explanation

Answer: E (both credit and cash sales.)

Explanation

The sales account receives the total of the sales day book (credit sales) and cash sales from the cash book.