Departmental Information Cannot Be Added to a Journal Entry When

question 16

Multiple Choice

Departmental information cannot be added to a journal entry when -

• A) balance sheet accounts are involved because departmental accounting applies only to income and expense accounts
• B) you forgot to add the department for the supplier or customer in the ledger record
• C) the entry uses only linked accounts and more than one department is involved in the transaction
• D) a sale uses more than one revenue account or a purchase uses more than one expense account

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Definitions:

Building

Refers to a physical structure considered a fixed asset on a company's balance sheet, used in operations or investment.

Incremental Borrowing Rate

The interest rate a company would have to pay if it borrows additional funds.

Payments

Transactions wherein money is transferred from one party to another, typically in exchange for goods or services.

Borrowing Rate

The interest rate applied to loans and borrowings taken by a company or an individual.