Answer: False
On account is an accounting term that denotes partial payment of an amount owed or the purchase/sale of merchandise or services on credit. On account can also be referred to as on credit. When services are sold to a customer, the seller normally creates an invoice in its accounting software, which automatically creates an entry to credit the sales account and debit the accounts receivable account. When the customer later pays the invoice, the seller would debit the cash account and credit the accounts receivable account. In this question the sales was on credit basis (on account) so there no cash is received at the time sales. When the amount received at that time only cash is debiting.
Journal Entry
Accounts Receivable A/C Dr ....
To Sales A/C .....
(When services are sold on credit basis)
Cash A/C Dr. .....
To Accounts Receivable A/C .....
(When cash received from the debtor).
Billing a customer for services on account would result in a debit to cash. Select one:...
To increase the cash account, the bookkeeper will Select one: O a. debit cash O b. credit cash O c. debit accounts receivable O d. None of the above
The entry to close the drawing account would involve a Select one: a. debit to capital. b. credit to cash. c. debit to Income Summary. d. credit to net income.
Beach Company receives $25,000 cash revenue for services performed. The transaction would involve a Select one: a. credit to Cash. b. debit to Income from Services. c. debit to Accounts Receivable. d. credit to Income from Services.
The entry to record the purchase of supplies on account is: Select one: O A. Debit Cash, Credit Supplies O B. Debit Accounts Payable, Credit Supplies O C. Debit Supplies, Credit Cash O D. Debit Supplies, Credit Accounts Payable
Customer statements can be prepared in QBO. Select one: O True O False Which item type should be used when setting up products sold by a company that uses a perpetual inventory sy Select one: O A. Service B. Inventory part O C. Non-inventory part D. Product What is the preferred account type for the debit account in the entry to record a customer's payment by credit car Select one: A. Other Current Asset OB. Income O C. Bank O...
On September 8, a company provides services on account to a customer for $2,700, terms 4/10, n/30. The customer pays for those services on September 15. Record the transactions for the company when the services are provided on September 8 and when the cash is collected on September 15. (If no entry is required for a particular transaction/event, select "No Journal Entry Required" in the first account field.) View transaction list Journal entry worksheet 1 2 Record the cash collected....
On September 8, a company provides services on account to a customer for $1,800, terms 5/10, 1/30. The customer pays for those services on September 15. Record the transactions for the company when the services are provided on September 8 and when the cash is collected on September 15. (If no entry is required for a transaction/event, select "No journal entry required in the first account field.) View transaction list Journal entry worksheet Record the service revenue on account. Note:...
What would be the effect on the accounts if the business provided services to a customer on account? O A. An asset would be debited and an expense credited. OB. An asset would be debited and Revenue credited. O C. Capital would be debited and Revenue credited. OD. An asset would be debited and Capital credited. Click to select your answer. Type here to search one A Net income or net loss for a period is calculated by the following...
17 On August 12, a company provides services on account to a customer for $3.400. However, on August 16, the customer is not completely satisfied with the service and the company grants an allowance on the amount owed of $420. On August 20, the customer makes full payment of the balance owed, excluding the allowance Record the services provided on August 12, the sales allowance on August 16, and the cash collection on August 20. Of no entry is required...
On September 8, a company provides services on account to a customer for $1,800, terms 3/10, n/30. The customer pays for those services on September 15. Record the transactions for the company when the services are provided on September 8 and when the cash is collected on September 15. (If no entry is required for a particular transaction/event, select "No Journal Entry Required" in the first account field.) View transaction list Journal entry worksheet 1 2 Record the service revenue...