Vouching Recorded Transactions Involves Taking a Sample from the Journal

question 74

True/False

Vouching recorded transactions involves taking a sample from the journal and tracing the items back to the source documents to ensure the transactions occurred.

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Definitions:

Liability Account

A liability account records debts or obligations a company owes to others, appearing on the balance sheet.

Owner's Equity Account

An account on a company's balance sheet representing the owner's total interest in the business, after subtracting liabilities from assets.

Transaction

An agreement or communication carried out between two or more parties that results in the exchange of goods, services, or money.

Credits

Credits refer to a bookkeeping entry that increases a liability or equity account, or reduces an asset or expense account, reflecting the opposite side of a debit.