Indicate whether each of the following statements is true or false________ a) The general ledger is often called the book of original entry.________ b) Transactions are first recorded in the journal and then transferred to the ledger.________ c) The process of making entries into a journal is called posting.________ d) The general ledger is an example of a source document.________ e) The list of a business's ledger accounts and their account numbers is called a chart of accounts.
What will be an ideal response?
a) F b) T c) F d) F e) T
a) This is false. Transactions are recorded in journals before they are entered into ledger accounts. Journals are therefore books of original entry.
b) This is true. Transactions are first recorded in the journal and transferred to the ledger.
c) This is false. After transactions are initially recorded in a journal, the dollar amounts of each debit and credit are copied into the ledger accounts through a process called posting.
d) This is false. To simplify recordkeeping, businesses rely on source documents, such as cash register tapes, invoices, time cards, check registers, and deposit tickets. Data from source documents are initially recorded in journals and then they are entered into ledger accounts in the general ledger.
e) This is true. The chart of accounts is a list of all ledger accounts and their account numbers.
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