Which of the Following Types of Transactions May Not Typically

question 61

Multiple Choice

Which of the following types of transactions may not typically be accounted for using the cash method?

• A) sales of inventory.
• B) services.
• C) purchases of machinery.
• D) payments of debt.
• E) sales of securities by an investor.

---

Definitions:

Bank Reconciliation

The process of matching and adjusting the balance of an entity's bank account against its financial records to ensure accuracy.

Deposits in Transit

Deposits in transit refer to funds that have been received and recorded by a business but not yet reflected in the bank's records.

Service Charges

Fees charged for providing a particular service, often seen in banking and accommodations.

Current Assets

Resources anticipated to be turned into cash, disposed of, or used up either within one year or over the length of the business's operational cycle, depending on which period is greater.